How trading is changing taking into account modern technologies and conditions
In the modern world, everything is changing rapidly; technological progress has affected many areas of activity, including trading.
For this reason, many stock trading strategies simply stop working, and technical analysis indicators lose their effectiveness.
Yes, the basic laws of the market are still in effect and the increase in volumes confirms the trend, but there are also global differences in how the market functioned before and how it works now.
This is especially true for trading on the stock exchange and forex market; the changes that have occurred are most noticeable on these platforms.
How to get out of this situation if proven trading strategists begin to bring losses?
• Speed of information appearing – now news appears almost instantly and simultaneously in all corners of the globe. Traders simultaneously learn the news and begin to open trades in its direction.
This leads to the fact that the trend moves more sharply and at the same time such movements are shorter lasting.
• Social trading - a lot of trades are copied by other traders, which often leads to a sharp increase in demand or supply.
• Algorithmic trading – robots make decisions faster than ordinary investors. In some strategies, this has become a real problem: a person simply cannot keep up with the scripts and, as a result, opens trades too late.
• Market manipulation – if previously there were only isolated cases of market manipulation, now this phenomenon has acquired enormous proportions.
Thanks to the Internet, it is relatively easy to form a positive or negative opinion towards a certain product and thereby change the trend. What can we say about fake news?
Therefore, there are practically no assets left that can be successfully used in long-term strategies.
Exchange strategies taking into account the current situation
What to do in order to avoid mistakes that can lead to losses, given the realities of the modern market?
First of all, learn to observe the price and analyze its behavior.
Try to distinguish between short-term and long-term trends and close transactions on time. When trading on news, catch the beginning of a trend and close the deal as quickly as possible, without waiting for the correction to turn into a reversal.
When scalping, automate the process of opening and closing transactions as much as possible using the capabilities of the trading platform and third-party scripts.
Well, the most important thing is to trade more, even on demo or cent accounts . In stock trading, everything is the same as when driving a car, the more you drive, the more confident you feel on the road.