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Want To Trade Forex Like An Expert? Control Your Risk

by with No Comment Forex

Want to step above the crowd? Knowing when to cut your losses and being consistent and disciplined about doing so can help you truly elevate your trading game.

Why Controlling Risk Is Key To Developing As A Trader

At first glance, this sounds rather obvious, doesn’t it? It may surprise you, but far too many traders lose more money than they can afford by sticking with bad trades in the hope that things will turn around for them. In reality, this rarely happens.

Smart traders, in contrast, set firm stopping points with their broker before ever opening their trades. If their losses drop below the level set, they understand that the best thing they can do is to walk away.  While this sounds easy enough to do, actually doing it consistently in real life can be quite hard. It’s basic human psychology to try to hold on to what we perceive as ours and to recoup losses. Fighting through that urge and learning to walk away will put you head and shoulders above many traders, however.

Top Tip: Planning Is Key

Have a plan about how and when to cut your losses and be disciplined and consistent about sticking to it. For example, determine what percentage of your equity can you afford to lose before making a trade and set a stop-loss order to ensure you don’t go beyond it.

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Trading Strategy: Forget Price, Try Trading Volume

by with No Comment Forex

Are you ignoring the volume bars at the bottom of your price chart? It’s not unusual. Loads of traders prefer to track prices or

f

s when choosing a currency pair. At first glance, volume doesn’t seem to be the most powerful indicator, but there’s more to trading volume than meets the eye.

 

The volume section of your trading platform shows the total lots of the selected currency pair being bought or sold. For example, whenever heavyweight investors start opening huge trading contracts, trading volume quickly rises. Moreover, if the world’s media channels suddenly popularize a particular currency pair, trading volume tends to rise shortly after as thousands of traders open orders. In other words, trading volume is—among other things—a popularity meter. But how is that useful to you?

Volume and leverage

Before we even think about placing an order, we should first consider how volume relates to leverage. “Why leverage?” you may ask. What could volume and leverage have in common? Leverage is an important choice when you first go through the signup process. With Exness, you can open and manage multiple trading accounts from one convenient Personal Area. Each account can have a different leverage setting, which is very useful if you wish to trade both high volatility and low volatility pairs. The rule of leverage is simple and will give your trading strategy a solid foundation. low trading volume = low liquidity = high volatility = lower leverage

high trading volume = high liquidity = low volatility = higher leverage

A highly volatile currency pair could create huge profits when combined with high leverage, but such fragile orders tend to ‘Stop Out’ underfunded trading accounts in minutes when massive price fluctuations occur. Not recommended! Instead, try comparing the trading volumes of your favorite pairs with the major and minor currencies. If your pair is experiencing lower volume, then you might want to use a trading account with a lower leverage setting. Checking the volume of your preferred currency pairs could save you a lot of disappointment.

Strong price vs high price

Volume can be used to measure the ‘strength’ of a price shift, which answers a common question every trader asks themselves on a daily basis. “Is this price shift a coming reversal or just another bump in the road?”

Let’s consider a currency in a long-term downtrend. One day, the price begins to rise. Is this a breakout in the making, or just another fluctuation? A change in trend depends on many factors, but the first place to start checking is the trading volume. If the trading volume is low at the time of a price increase, then the market move is probably just a hiccup and the downtrend will return with a vengeance.

On the other hand, if the volume has been higher than usual, then you might be seeing the early stages of a price reversal. In a nutshell, low volume direction changes don’t stick. There are always exceptions to every trading strategy, but spotting a weak reversal is a very strong indicator.

How to test the trading strategy

Try opening up your trading platform and targeting a currency pair on the Market Watch list. Look back over the last few weeks until you find a significant fall in the trading volume, then check what happened to the price shortly after. Match your leverage to the average volume, then wait for the next possible breakout. If the price is reversing and the volume is rising, then the pair could be an attractive trading opportunity that deserves investigation or investment.

 

Open Exness Demo Account

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Quasimodo Pattern (Over and Under)

by with No Comment Forex

Quasimodo Pattern (Over and Under)

TABLE OF CONTENTS:

Easy guide to trading the Quasimodo Pattern

What is the Quasimodo (Over and Under) Pattern?

Conclusion:

Easy guide to trading the Quasimodo Pattern

The Quasimodo Pattern or Over and Under pattern is a relatively new entrant to the field of technical analysis in the financial markets. Although new, the Quasimodo pattern is a commonly occurring theme that is more frequent when price carves a top or a bottom or when price begins a major correction to the trend.The Quasimodo Pattern, although complex as it might seem is actually very simple. This trading pattern is especially powerful because when it occurs, in most cases, traders will notice a confluence with other methods of analysis.For example, when a trader spots a Quasimodo pattern near a support or resistance level, it increases the confidence of the trader or the trading probability. Likewise, when trading divergences, when you spot a Quasimodo pattern, that confluence can be used to trade the divergence set up with more confidence.As we can see from the above, the Quasimodo pattern is not a trading strategy by itself but is more of a confluence pattern that can be used to confirm a trader’s bias. Of course, the Quasimodo pattern doesn’t appear all the time, but when it does, traders can be sure that the market offers a high probability trade set up.

What is the Quasimodo (Over and Under) Pattern?

A Quasimodo Pattern is simply a series of Highs/Lows and Higher or Lower highs or lows.

Quasimodo Short Signal Pattern

There should be a prior uptrend in the marketsPrice makes a new high, declines and makes a new local lowPrice then rallies above the previous high to mark a new higher highPrice then falls to form a new lower lowPrice then rises towards the initial high (but does not make a new higher high).

The fifth level in the set up is the trigger, where a short position is taken. Stops are set above the higher high and the take profit level is up to the trader.

Quasimodo Long Signal Pattern

There should be a prior downtrend in the marketsPrice makes new low then makes a small rally and forms a local highPrice then declines to form a new lower low taking out the previous lowPrice then rallies to make a new higher high and then declinesThe final decline is equal to the first low

The fifth leg in this pattern is the trigger for long positions with stops set to at or below the lower low

Quasimodo Long Signal Pattern Examples:

Quasimodo Long Example #1

Price is in a downtrendPrice then makes a new low at 99.923 and then makes a new local high at 100.274Price then declines and makes a new lower low at 99.983Price then rallies to make a new higher high at 100.38 and then declinesThe final leg in the decline is just a few pips above the previous low. This triggers a long signal

Here is another example of the Quasimodo Long example:

Quasimodo Long Example #2 Quasimodo Short Signal Pattern Examples:

Quasimodo Short Example #1

Price is in an uptrendPrice then makes a new high at 1.5251 and then declines to make a low at 1.5187Price then rallies to make a higher high at 1.5321 and then declinesA new lower low is posted at 1.5165Price then makes a modest rally and this high stalls a few pips close to/above the previous highA short entry is then taken with stops near the highest highThere is also an additional confirmation yet again with the RSI divergence as well

Another example of the Quasimodo Short pattern example is given below:

Quasimodo Short Example #2

Conclusion:

As we can see from the above, the Quasimodo or Over and Under pattern is a relatively simple pattern, which when used in conjunction with other trading strategies or signals offers a great way to increase the probability of a trade set up.
Open an Demo Account and test this pattern.

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What Is The Best Forex Trading Platform For You?

by with No Comment Forex

Author:Exness Broker

As a trader, there are several factors that you should consider when choosing a forex trading platform. Some of these factors include your experience level, your trading preferences, and the tools you need for both technical and fundamental analysis.In this article, we shall analyze the different trading platforms offered by Exness to all its traders. Exness offers MetaTrader 4, MetaTrader 5, Mobile, WebTerminal, and MultiTerminal trading platforms.

MetaTrader 4 The MetaTrader 4 platform is one of the most popular forex trading platforms in the world and is used by millions of traders across the globe. This platform is quite easy to use and is ideal for traders getting started with forex for the first time. The MT4 platform offers 30 built-in indicators, as well as an additional 2,000 free custom indicators that any trader can download and use to perform their technical analysis.

The MT4 platform also allows traders to enter numerous types of orders depending on the market conditions, as well as allowing trading directly from the MT4 charts. The platform also allows traders to back test their trading ideas and strategies through the MT4 History Center.

MetaTrader 5 The MetaTrader 5 platform is an advanced version of the MT4 platform that offers more functionality such as the ability to execute more order types, and view the market across a wider range of time frames. This platform is well-suited to advanced traders who would benefit from the ability to build powerful EAs and sell them in the MetaTrader Market.

Mobile Platforms Given near universality of mobile devices such as smartphones and tablets, many traders are switching to mobile forex trading terminals in order to trade on the go. Although most mobile trading platforms offer limited functionality in terms of the tools available to traders, their main advantage is that they allow traders to trade wherever they are.Traders only require a stable internet connection and a mobile device that is compatible with their chosen mobile trading platforms, such as the MT4 and MT5 mobile trading platforms.

WebTerminal The WebTerminal is a trading platform that allows traders to trade directly from their web browser without having to download and install additional software. This is an excellent choice for traders who do not feel comfortable downloading trading software onto their computers, such as the MT4 or MT5 trading platforms. The WebTerminal is a stripped-down version of the downloadable trading software providing all the essential functionality with only the more advanced tools missing.

MultiTerminal The MT4 MultiTerminal is an advanced trading platform that allows traders to trade and manage different accounts. This platform is best suited for sophisticated traders with multiple accounts dedicated to trading different instruments, different strategies, or for the management of the accounts of other people.Institutional investors could also benefit greatly from this platform given their complex trading needs. The MetaTrader MultiTerminal allows traders to place new trades and allocate lots across different accounts simultaneously, which is vital for traders managing multiple accounts.

Conclusion To sum up, it is crucial to note that each of the above forex trading platforms has different functionalities that are suited to different types of traders.For most beginner traders, the MT4 platform is their best choice, although they might not utilize all of its functions. The choice of a trading platform is largely subjective and depends on a trader’s needs. The best course of action for most traders is to open a demo account in order to test their preferred trading terminal before engaging in live trading.