Forex Swing Trading Strategy - A Simple One For Huge Gains Anyone Can Use
To master the enclosed swing trading strategy, will only take a week or so and then your all set to start trading it for big regular currency profits - Let's take a look at it in detail.
Before we look at the strategy, lets review exactly what swing trading is and why it works. Swing trading is simply buying or selling into overbought or oversold currencies.
So why do currencies move to overbought or oversold levels? The answer is simple because humans push prices to far on the upside when greed is present and to far on the downside when fear is present. All short term price spikes either up or down, don't last long and prices move back to more realistic levels which reflect the long term supply and demand picture.
If you look at any currency chart, you will see this happen and it will always happen, as humans will always be subject to their emotions - but how do you swing trade successfully?
Let's look at a simple Forex swing trading strategy for success. I have used this strategy with no alternations, for over 20 years and it will always work here it is:
1.Look at your charts for sharp movements either up or down.
2.Check how overbought or oversold the currency is by looking at some momentum indicators and I like the RSI and stochastic. These are visual indicators of price momentum and don't take long to learn and you can see them on any free chart service.
Let's look at an example, of a currency that is overbought and how to swing trade it:
1.When the currency moves up sharply look for the momentum indicators to become overbought and wait.
2. As soon as they turn down look to sell and put your stop above resistance.
3. Target an area of fair value on the downside and a great level to look at is the mid average of a Bollinger band
4. Take your profit just above this level and bank it.
In a bear market you would do exactly the opposite.
This strategy is simplicity itself but it works and will continue to work in addition, you will find it easy to use because you don't need as much discipline as long term trend following, you also get plenty of trades, it's exciting and fun.
I call swing trading "hit and run trading" and that's what your doing - getting high odds set ups, hitting them and then banking profits, before the position can turn back on you. If you learn and practice the above strategy for a week or so, you will soon be confident enough to applly it for long term currency trading success.
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In this article, we will outline a simple and profitable Forex trading strategy which is easy to understand and learn and can be used by anyone to seek big Forex profits. Let's take a look at the strategy and how it works in greater detail.
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