A Simple Forex Strategy for a Newbie
At one time, I, like most beginners, used ready-made Forex strategies and could not overcome the
break-even point and even break even at the end of the month.
Most trades ended in losses, and the profits from successful ones were so small that they couldn't offset the previous losses.
As it turned out, the reason for this situation was purely psychological: according to probability theory, the number of losing and winning trades should be roughly equal.
But since most winning trades are closed prematurely, and some losing trades are closed later than expected, the overall financial results leave much to be desired. This prompted the desire to create a Forex strategy for beginners.
The Forex strategy for beginners is based on the use of pending orders, sometimes called stop or limit orders, depending on the execution method.
This approach allowed me to immediately recover from losses and even make a small profit over the next month. The advantage of this strategy for beginners is its ease of use and the lack of need to constantly be in front of the trading terminal.
For convenience, this trading approach can be broken down into several stages.
Forex Strategy Basics for Beginners
1. Finding market entry points is the most difficult step. You need to identify the points on the currency pair chart that, once reached, will allow you to most accurately predict the price's future behavior. This
Forex market is currently and the price is moving within a narrow price channel, just a few pips wide.
Obviously, if an important event occurs, the price will sharply jump in one direction or another.
buy stop and sell stop orders , 15 pips from the channel boundary in this direction, as we don't know where the price will go. Don't forget about the stop loss; it should be placed approximately where the opposite order is placed. Take profit is set around 20-30 pips.
After one order has triggered, the second can be closed.
The second market entry option I used is using key points; it's also quite simple. Find an instrument or wait until the price is near a key level. In my case, I simply used round price values of 1.2000 or 0.9500; the more zeros, the stronger the psychological level.
The idea behind this option is that there are two possible price behaviors at these levels: it will either break through and continue, as in our case, or reverse.
Therefore, we place a pending order beyond the key level. For example, suppose there's an uptrend in Forex, and the price is currently at 1.2985 and approaching 1.3000.
Therefore, we place a pending order at 1.3020 to avoid a false breakout, and a stop loss at 1.2995.
2. Controlling your trades is also quite important, as you need to find the strength not to interfere with the trade. Only pending orders that haven't triggered are closed because the conditions haven't been met.
The only thing you can do is lock in profits by moving the stop-loss and take-profit levels on an already profitable trade.
At one point, this Forex strategy for beginners brought me about 10-15% profit per month. One of the conditions for its use is guaranteed execution of orders, especially stops. Therefore, the best broker for this approach is AMarkets or one of the recommended brokers - https://time-forex.com/reyting-dilingovyh-centrov .
