In Forex, many people do not understand the importance of price trends. The price is the sole indicator that guides the traders where the profit can be secured. If you are trading in a dry market there is no possible way to earn money via trading. We have seen people losing their capital by trying to find the ultimate trading strategy. This is nothing but a hoax which only increases the chance of blowing up the account balance.
In this article, we are going to show you and explain some of the factors that will help you identify where the price may end up on the chart. However, you should not consider this as a definitive guideline because the context may vary depending on the market condition. Let’s dive into the details of this article.
Is the trend more important than profit?
The most obvious question that arises is to explore the concept of trend. Is the trend more important than the profit? The answer greatly depends on the traders. But remember earning money is the sole purpose of the investors. To explain this concept, we will try to take help from some metaphors. Imagine a car can only run on a smooth road. Suddenly, for the sake of argument, let's say the road has become bumpy. Although our focus is on the destination due to unavoidable circumstances, the riders may be forced to find the alternative route.
If he does not take the right route, he might end up at a dead end. This is the same thing is Forex but the only difference, the car is this strategy and the route is the price trend. Without leveling them on the same layout there is no way to reach the ultimate destination which can secure consistent profit. The trend is far more important than the completely unpredictable profit.
Path of the successful traders
The successful traders are always following a safe path. They chose the best broker and they stick to the major trend. Google the term Forex trading Australia and you will find many articles stating the majority of the traders are losing money. If you dig deep enough, you will be surprised to know, the most vital rule is not followed by the rookie traders. The traders are always advised to execute orders with the major trend. Instead of trading with the trend, they start trading the retracement. Very few traders understand the proper way to find the trend.
They rely on indicators and other complicated tools. Learn to use the trend line tool and you will be able to find key trading points. You don’t have to make things overly complicated by using unnecessary variables. Act like the pro traders at Rakuten and learn more about the major trend.
How to identify the price trend?
First of all, there is no exact technique that can forecast the possible place of the price. The experts use a combination of three different analyses known as the fundamental analysis, technical analysis and the last one is sentiment analysis. When all of these methods are incorporated, this helps any individual who is trying to read and decode the chart to gain a more accurate representation of the market trend.
It is always better to practice in a demo account before making the ultimate decision as the chance of error is always high. If this technique seems much complicated, it’s better to use the price action method. This strategy has been used by many professionals as it focuses on the possible turning point.
As a result, this will give a much better insight into the market. Keep in mind that all that matters is the price whether it is going up or down. Do not bring any unnecessary hassles as it will only lower the chance of making a profit. Learn to trade with the trend and only then you can secure your trading career.