Wednesday, June 19, 2024

Pick the Trading Strategy that Fits Your Needs.

May 24, 2017 by  
Filed under Business, Opinion, Weekly Columns

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( There are many different trading strategies available today and it is important to find the strategy that best suits your needs. While forex trading has become popular, it can be risky, but a large part of succeeding is having a strategy that works for you and fits your needs. It is certainly possible to build your own strategy to ensure that it fits your needs and this can be fairly quick and simple if you know where to start.

Picking the Details of Your Trading Strategy

In order to create a strategy, you must have access to charts for the time frame to be traded. Have a pencil and paper at the ready so that you can write down any ideas to help you create your strategy. To begin, you need to work out your time frame. Decide if you are a day trader, a swing trader or an investor. Decide if you will trade with a monthly time frame or one-minute time frames. By deciding how you want to trade, you will be able to create a trading strategy that you can stick with as it will fit with your trading plan.

Analyze the charts and analyze the indicators to see if you can create a set of rules for when to enter the market in order to make a profit. Many traders leave out back-testing with the view that historical data will not guarantee future profits. However, if a strategy has never worked in the past, it is unlikely to start working now so this historical data is important. At the same time, you need to work out what your risk would have been following those rules. This will help you set your stops for future trades. Look at the ideal exit points for specific trades and see if there is an indicator or method that you can use successfully. Use a range of patterns, charts and other tactics to help you determine how best to capture profits.

Keeping Track of Your Strategies

It is possible to look for tactics that work over different length time frames. It is common for short-term anomalies to take place that can offer consistent profits for traders. While these may be short term and only last a few days, they can often be used again in the future. It is therefore worth keeping track of all strategies and finding a way to incorporate these into a trading plan. You can then pick the strategy according to the circumstances and by keeping a close eye on the conditions, you can pick the strategy that will best favor those specific conditions and will allow you to capitalize on the market.

Creating your own strategies will help to ensure that you use a strategy that best fits your needs as it is developed by you for your use, and not by others. Pick the best strategy to fit the current conditions and be confident, but not too rigid to change to a different strategy if the conditions demand it.

Staff Writer; Latasha Jackson

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