For Beginners page 4

Forex trend trading is exactly the way many traders use to make a profit on the currency exchange. Trend trading has many advantages: the ability to take a large number of pips due to a strong, directional price movement, a high probability of profit, and good accuracy of signals. These are the reasons that allow traders to use trend trading effectively.

Any price movement can move in one direction only for a limited period of time. After that the quote changes its trend, goes to a sideways trend or starts an opposite trend. It is quite difficult to predict such changes, that is why modern traders invent more and more methods of market analysis. By understanding when a correction begins, traders can determine the probability of the next reversal and place appropriate orders.

There are a lot of myths surrounding investing. Some say that it is too complicated for a beginner, and you can't figure it out on your own. Others portray the image of a successful investor who travels all the time and does almost nothing. So, let's find out how things really are.

All traders on the forex market want to be successful. But how is this financial success evaluated? In most cases, we compare the size of incurred losses with the return value. However, this indicator by itself cannot be sufficient motivation. In case of a series of losing trades, we run the risk of falling into one of the psychological traps.

Most traders and investors are often confronted with such a purely market concept as "volatility". This term is used to analyze price movements as well as to characterize the trading instruments themselves in any financial market. Below you will learn what is the volatility of currency pairs - the concept, definition, characteristics, and how to use it when making trading decisions. What is the volatility of currency pairs? Volatility is a statistical financial index that describes the amplitude of price movements of a single trading instrument.

The Wolfe Wave pattern is a trading method, which was originally invented by Bill Wolfe and is described in detail and clearly in his book. Wolfe's method, of course, was developed specifically for the stock market of those years, but now you can see his markup on currency pairs and other instruments as well. Thus we can safely say that Wolfe waves can be applied boldly to the forex market.

Trading volume is the main measurable indicator in determining price levels in the market. The trading volume increases at the highest activity and can influence the price trend, either strengthening it or changing its direction. Actually, the main reason for studying this indicator is an objective analysis of the market situation at the moment. Most traders prefer the Market Facilitation Index (MFI) indicator, as it perfectly copes with the above tasks. Let's take a closer look at the functionality, setup, and application of this tool.

The choice of time frame for trading is one of the problems every trader faces at the initial stage. It is necessary to grasp the subject in detail and define: what is a time frame, what are its purposes, what kinds of time frames exist, what time frame is better to trade in, and what time frame should be chosen by a beginner. In this article, we will provide an insight into the notion of time frame, learn which one is the best for beginners, as well as will find out how to add a custom time frame.

The forex market is characterized by the fact that there are no trifles in it. Any seemingly insignificant detail over a long distance can turn into significant drawdowns. Let us pay attention to any price chart - the quotes are changing every second. Many trading strategies are based on such insignificant fluctuations, or, as they are also called market noise. Scalping, pipsing strategies - the aim of trade here may be just a few pips or tens of pips. But there are a lot of positions during a trading session.

The success of trading on the forex market implies the ability to correctly determine the most successful trades. And here you can't do without the methods of forecasting further currency movement. However, to make accurate forecasts, it is necessary not only to have skills in technical analysis of the market - but it is also vital to understand and be able to analyze the fundamental factors that affect the currency rate.