Forex Trend Trading Explained

Forex Trend Trading Explained

When it comes to Forex trading, there is no better strategy than doing trend trading. Forex trend trading refers to the entering of position in the direction of the trend and then profit from the movement.

The good thing about trend trading is that currency tends to move in a particular direction for quite sometime and this will give you a lot of opportunity to trade. In fact, some people tend to think of it as getting into a trend at the start and exiting it at the end which is not possible. This is because there is no way we will be able to know when it is at the very beginning or when it is at its very end.

Therefore what we are interested in doing is to buy the dips in an uptrend and sell the rally in a downtrend. If you have been trading for sometime now, you will notice that the market never moves in a straight line. It will move in the form of a wave which retraces and extends in the direction of the trend. What we are going to do is to Buy whenever the price moves down into a dip for an uptrend or we will be Selling whenever the price moves up into a rally for a downtrend.

To better help you identify an entry and exit, you can make use of the stochastic or RSI. Other than helping you with your entry and exit, the indicators can be used to help you reduce the problem of false alarm which is something that is very common. Trend trading has been one of my favourite strategies and if you are interested to know more about it, you can click on the link below to visit my blog.

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