Most of the following strategies come from stock. Many well-known traders have used these strategies and they have prouved to work. However, we, the author of this article, are not responsible for your own riks, mistakes and losses.
The ABCD Strategy
If you want to master a simple and effective strategy, the ABCD is the one you must go for. This strategy is good for beginner and intermediate traders.
How to enter the trade
- Set the chart too 5-minutes intervals.
- From A to B, buyers are aggressively buying.
- Don’t enter the trade because.
- At B, traders who bought the currency early start selling it for profit
- Don’t enter the trade because you have know of the future bottom of this pull back.
- If you notice that the price stops moving (e.g., at C), the currency reached a support level.
- Wait to see if the price makes a support higher than A.
- Now, you can enter the trade
- Remember to set your profit and stop loss
- The stop is the loss of point C. If the price goes lower than C, sell and accept the loss.
- It is very important to buy the currency close to C to reduce the loss.
- If the price moves higher, sell half of the position at D, and bring the stop higher to your entry point (break-even).
- When the currency shows a new low on a 5-minutes chart, it is a sign of weakness
- Get out the trade and, sell the remaining position and take profit.
- You must never enter a trade without knowing where your stop loss is.