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Trend-following strategies rely on the realisation that existing trends are more likely to continue than to reverse. The search is for an upward or downward trend with the greatest possible significance. This is possible by means of trend lines, but also by trend-following indicators.

The more often a trend line has been tested in the past, the more significant it is. This means that older trends are more significant than more recent trends. This results in a conflict of objectives between the two desirable outcomes of "high hit rate" and "early entry". This also applies when trend following indicators are used instead of trend lines to define trading signals in Exness mobile app. A trading signal can be triggered, for example, if an intact trend is continued after a consolidation by reaching a new high.

Swing trading in FX trading

Swing trading strategies are not too far removed from trend following strategies. In essence, it is about using corrections within an overriding trend to enter the market. If trading signals are defined visually, a buy signal is generated in an overriding uptrend if the market is moving near the uptrend line and there are no indications of a break of the trend line (e.g. volume or price gaps).

What every Forex trading strategy must achieve

Regardless of the approach chosen, every Forex trading strategy must meet the expectations of risk and money management simply because of the leverage effect. Part of every strategy must therefore be specifications for position sizing and loss limitation.

With the determination of the position sizes, the stake per trade is set. By determining the loss limitation through stop loss, the maximum amount of capital that may be lost per trade is determined. For example, it can be determined that the stake per position should not exceed 1% of the account balance and the maximum loss per position should not exceed 0.10% of the account balance.

Conclusion Learn Forex Trading

Forex trading is not difficult to learn. The platforms are simple, there is only one instrument for each market and you don't have to choose from umpteen different instruments. There are hardly any high minimum deposits and you can often start trading on the same day you open an account. Success or failure is immediately apparent and ensures a steep learning curve. However, painful or expensive periods of learning can never be avoided; the prerequisites for long-term success are passion, discipline, a hunger for knowledge and a willingness to experiment. If you start small and constantly work on yourself, the world of trading is open to you!