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Calling the market right is not actually that hard when trading forex. What is hard is find spread betting strategies that can consistently increase your profits and limit your losses.
Here are three forex trading strategies that should help.
Forex Market Timing
This is a form of technical analysis and a fairly well established spread betting strategy for ensuring that your entry and exit prices are well timed. Once you have found a trade that you link the application of market timing and the chartist’s view can help you gauge whether or not a price is overbought, oversold, in trend or due a reversion. Investors intelligence, FuturesTechs, and Acuity Trading all have good packages to help with this.
Technical are tricky to trade though on unless you have a good and experienced eye for the market. Trading currency based on economic events that are either priced into or not price into the market is a good option though. Although with this you are not really trading currency, you are trading economic events, but using FX to try and profit from yoru predictions.
Key Forex figure reporting and economic dates
Economic indicators as just as important for forex trading as they are for stock, index and commodities trading. For the simple reason that they move the market.
Before you enter any trade, part of your forex trading strategy should be to look for key upcoming economic data releases. ETX Capital provide a good economic diary on their website that shows who and what is reporting.
The reason this should be part of your forex trading strategy is that if you enter a position based on technical and fundamental analysis then results or economic data are released it totally re-balances price. It could result in an absolute change in direction and bear no relation to your entry strategy.
Complete forex trading strategy discipline
So many traders enter into forex position correctly but fail to manage it appropriately once it is open. Discipline is a key factor is increasing profits and a lack of it is a massive contributor to excessive losses.
All traders should have a strategy of running profits and cutting losses.
If a trade is not going your way, close it out and look for the next opportunity. If you are showing a profit don’t be too eager to lock it in, a good trade can yield good spread betting profits. You can look to lock in some profits by using guaranteed stops and trailing stops offered by the top forex brokers as part of your risk mitigation strategy.
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Richard founded the Good Money Guide (previously Good Broker Guide) in 2015 and has been a broker for 20 years most recently at Investors Intelligence and previously a multi-asset derivatives broker at MF Global (Man Financial). Richard started his career working as a private client stockbroker at Walker Crips and Phillip Securities (now King and Shaxson) after interning on the NYMEX oil trading floor in New York and London IPE in 2001 & 2000.