Many traders make mistakes in entering trading market. They do not pay attention to the current market conditions. When the market moves slowly, it is impossible for you to trade accurately and effectively. Then, these moments often cause a trader to lose the profit he has earned.
So, what should be done in entering a slow market condition?
One of the main things in trading is to maintain a balance in your account. Some traders easily use their margins for entry without considering the conditions of price movement. They worry about not getting a chance or thinking every market condition can be traded. According to experienced traders, market conditions have cycles. They are not always choppy but also not always trending strongly.
Based on Learn to Trade the Market, there are two market conditions that is worth trading and one not worth trading. The two worth trading are a trending market and a range-bound market that’s moving between a defined support and resistance. The one condition that you should avoid is a choppy market condition. It is simply backing and filling in on itself in a very erratic manner with no real boundaries or direction.
When the market is slow or in an uncertain condition, you must decide to make a temporary break as soon as possible. You can continue to monitor the market but do not have to enter the market. Additionally, you must know how to read the market and determine conditions that are trending, ranging (sideways) or choppy and erratic.
In ranging conditions, you can still enter the market because price movements still follow the rules of the support and resistance levels. However, in choppy conditions, where the direction of movement is uncertain and tend to ignore support or resistance levels, you must not enter the market. If you enter the market, you will even get a big lose.
Read more : Applying Stop Losses in Forex Trading
