Amazing ways to develop an advanced trading strategy
Posted by : Premraj | Posted on : Thursday, November 14, 2019
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SU
REDDITForex traders are always biased about the profit factors. The naïve traders in Hong Kong never think about the worst-case consequences in trading. They are always placing lots of trades and making things complex. On the other hand, some of the smart traders are using a simple approach to make some decent money. To lead your dream life, you must use an advanced trading strategy. Creating an advanced trading strategy is not easy. There are four essential things you need to consider to make your traditional or normal strategy super advanced. These are –
— Ability to forecast
— Multiple time frame analysis
— Use of price action signals
— Booking a portion of the profit
Ability to forecast
Trading is more like speculating the price movement of the financial instrument based on some financial data. The retail traders never think the fundamental factors are going to change the trend. Most of the traders think technical analysis is enough to secure good trades. For this very reason, the majority of retail investors are losing money. You must develop strong forecasting skills. Learn about the major news and its impact on the Forex market. Forget about the technical parameters and try to speculate the price movement based on fundamental data. Once you master this technique, placing quality trades based on fundamental and technical analysis, will be easy. This will push your skills to the next level.
Multiple time frame analysis
Making consistent profit in the options trading industry is not so easy. The advanced traders often end up losing money at the end of a financial year. To avoid such problems, you must learn to analysis the different time frame data. Once you incorporate the simple concept of multiple time frame analysis, nothing is going to be tough. You can filter out low-quality signals with a high level of accuracy. Though mastering the art of multiple time frame analysis requires a precise understanding of the price movement, still you can master these skills in less than a month. But make sure you take help from the professional broker Saxo since they offer a high-quality demo trading platform to retail traders.
Use of price action signals
Price action signals are widely used by advanced traders. It allows retail traders to use tight stops in each trade. Though the use of tight stops is considered a risky approach in trading this is by far the most effective way to protect your trading capital. Let’s say, you are placing trades based on the simple moving average crossover. Most of the time, you are having great trades but still, you have a big room to improve. Using the moving average trading strategy requires a perfect understanding of the oscillators. When it comes to indicators, you are bound to use wide stops which can increase the risk in trading. To avoid such problems, you can start using the price action signals since it will help you to make better decisions at the complex market conditions.
Booking a portion of the profit
No one knows what will happen to the price of a certain asset. The pro traders are always prepared for the worst-case scenario. If you want to make a profit and build your career in the investment industry, you must learn to book a certain portion of your trading profit. Things might sound silly at the initial stage but once you get familiar with your skills, it won’t take much time to secure a safe position in trading. Once the trade goes in favor, close a certain portion of the trade and use the trailing stops. Though this might sound complicated this is one of the most effective ways to create an advanced trading plan. Never expect to make big profits while you are focused on a traditional approach.
