How to trade with the major trends?

Trading with the major market trends is one of the easiest ways to make sure you will make profit. Sadly, new investors don’t give enough importance to trend trading strategies. They are always placing random trades without even knowing the trend of the market. This is where the experienced traders are one step ahead. They use the daily or weekly time frame to find the long-term market trend. Once they find the trend, they only trade with the trend. There are two basic types of a trend in the spread betting industry. The first one is the long-term trend and it’s much more stable. The second one is the minor trend which changes frequently. As a currency trader, you will have to learn to trade the long-term market trend.

Use of Fibonacci retracement tools

The use of Fibonacci retracement tools is one of the easiest ways to ride the long-term trend. But how do you use it? You need to find the long-term key swings of the market. Use the most recent low and high to draw the bullish retracement. Similarly, you need to use the most recent high and low to draw the bearish retracement. But not all retracement levels are good to trade. You need to focus on the major retracement levels, namely the 50% or 61.8% retracement levels. Some of you might just place pending orders right at the key levels but this will not work. You have to rely on the price action confirmation signal. Learning price action trading might seem a little bit challenging but if you do some hard work, things will become really easy for you. Take all the time you need and learn to trade in demo accounts. Never trade with real money unless you know how to trade properly.

Impact of fundamental news

Fundamental news has a great impact on currency pair movement. In the spread betting industry, you can make any real progress unless you know the details about the fundamental news. Major news like MPC official vote, NFP can even change the long-term trend. So it’s highly imperative you learn to trade the market with very low-risk exposure. Being new to this industry, you should use the demo accounts. Learn how the fundamental factors affect the price of certain assets. Knowing the details of news factors might seem extremely difficult but you don’t have to macro manage everything. Take all the time you need and trade the market with confidence.

Prior to the high impact news release, you need to scale your trade. Never place any trade prior to high impact news. Wait for the fundamental data and compare it with the technical factors. If both data suggest you to execute any trade, take the trade. But if you are not sure about a certain trade, ignore the trade since you will have tons of signals in near future. Be very calculative when it comes to the investment business. Stop taking the trades based on emotions as it will ruin your career.

Money management

Money management plays a great role in your trading performance. The new traders always use high leverage trading accounts to secure big profits. But do you really think trading with high-risk exposure can help you earn huge money? If you think so, you are making a big mistake. Learn to trade this market with proper risk management. No matter how well the trade setup is, trade with a very low-risk exposure. Never risk any amount which you can’t afford to lose. Think of the long-term outcome of this business. The short-term big gains will never help you to become a profitable trader. Learn to manage your risk in an efficient way so that you can easily make money even after losing trades. Stop thinking about big winners and instead focus on making a consistent profit. Think rationally to become a profitable trader.

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