How to Master a Great Forex Trading Secret

I, was shorting the EUR / USD, 2Q14 and I would at times experience the market not doing exactly what I expected. Imagine that !! What to do? Put in a 20 pip stop loss then reenter a short again? After all that is what you learn from the free educational sites from the brokers.

It makes you think about their motivation. They make money on churning. Each round trip they are making money so they want a lot of transactions. We have a very different approach that brokers hate. We dollar cost average with geometric progress and make a tidy profit on less trades. The secret to trading FOREX is mastering when, where and how much.

As I said, I was shorting the E / U, and after price moved up quickly, I was concerned about 'is this the top'. If we pick what we think is a top and the position moves against up against us, below is a list of 7 ways that we can protect ourselves when trading in these environments:

1. Verify fundamentals and bias with the most reliable resources: trader collections on the webinars, (my favorite news source), your trading mentor.

2. Scale in at the appropriate S / R levels, ranges and geometric amounts

3. Adjust your limit levels as you scale if / when appropriate. If there is a mini spike, then keep your limits put "plan the trade and trade the plan". If there are UFO's (unidentified FOREX objects) at play, move your limit to take money off the table and be ready for the next entry.

4. Know the strength behavior your pair the A / U does not act like the G / J. So what? Adjust your limits and DCA's accordingly

5. Look for interim or mini S / R levels to bolster your position. If you are in between DCA's and are stalled for a few days, bolster the bias with a pos position.

6. Wait for "nesting" price action on the 30 M after news events to see things settle out.

7. If movement direction does not track with logic there may be other forces in play, especially during times of thin liquidity. Not to worry they will not last long. Remember the run up of 2Q14 of the E / U. It hit near to 1.40 That was driven by China but even they ran out coin. I was shorting with DCA's and killed it at 1.35. That made my month.

By: Mike Gould, teacher and mentor at Forex Winners Academy

Source by Michael Gould

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