Most people tend to generalize Forex trading to gambling. Arguably, it is true to some extent as both rely on fortune. However, what differs them is that Forex trading requires appropriate strategies.
In Forex trading, these appropriate strategies are indubitably essential to, at the very least, keep ones from losing. The right strategies at the right moment prevent one from getting out of the game and bring trading opportunities.
Hence, in so doing, continually implementing these strategies belong to basic Forex trading laws to be consistently profitable. As many Forex experts might have agreed, being consistently profitable should be the utmost priority for any Forex traders.
That said, there are four fundamental strategies to consistently profit in conducting a Forex trade. The concise description of each strategy is as follows.
Also Read: 3 Successful Keys to Use Basic Forex Techniques
Trend Strategy
Identical to its name, a trend strategy is a strategy to trade depending on the trade of the market. If the market is in an uptrend, in which the trajectory of most prices is up, it is better to play long, or buying with the expectation that it will rise in value.
On the contrary, if it is in a downtrend, a condition in which the trajectory of most prices goes down, it is highly suggested to go short. Go short is, in addition, a move to sell first and repurchase at a lower price later in the future.
Range-Bound Strategy
While the price is uncertain, hitting a particular high (resistance) and low (support) points, it is better to implement this strategy. The range-bound strategy is, in short, an attempt to trade forex in between.
To conduct the strategy, most expert traders mostly sell while the price almost hits the boundary of resistance price. On the other hand, traders can buy when the price edges to its support limit.
Breakout Strategy
Breakout is a condition when the price finally breaks out the channel, whether its edges up or down. Put simply, the breakout strategy might benefit much, but the required patience is also much.
The basic principles of the breakout strategy are indifferent to the trend strategy. Once the price breaks upwards, go long. Meanwhile, once the price breaks downwards, go short.
News Release Strategy
There is nothing wrong with this strategy as this strategy is quite speculative. Similar to the name, this strategy heavily relies on the news release. It is, furthermore, a chance to prove personal judgment over the news, mostly the news in the early months, and the released figures.
This strategy is best to introduce novice traders to Forex platforms. Thus, it is an efficacious way to learn about the volatility of Forex markets while paying attention to news and figures. Thus, many traders recommend using this strategy in the Demo Account.
Also Read: Why is Demo Trading More Profitable Than Real Trading?
