Monday, November 23

Simple forex scalping strategy you can use to trade forex

This is actually one of the more detailed strategy videos I’ve seen on YouTube, and includes the following:

1. Using multiple time-frames to identify trends as well as support/resistance. This gives us our bias and areas to focus on for price action.

2. Finding areas of consolidation (he calls them areas of sensitivity) with identifiable highs and lows.

3. Using confluence to identify high-probability trades. For example, at 3:06 we have confluence of the 100 MA and the identified resistance level, which provides us an easy stop-loss (just above the area of confluence) as well as a foreseeable entry time (because the resistance is horizontal and the 100 MA is converging downward upon it), so then at that time we look for something to confirm price movement.

4. Confirmation of price movement. And I really like how he addresses at 3:49 the possibility of trading a breakout, and why he would have waited in this case. But the price movement confirmation is based upon the attempted breakdowns below support he identified there, and then a confirmed breakdown which he discusses at 4:20 along with the idea of exhaustion or capitulation, resulting in a retracement to our entry point. As you may know from experience or from watching other videos, sometimes we don’t get that retracement, in which case we would have lost out on this trade according to his conservative/delayed entry. But we also avoid fake-outs like he mentioned at 3:49, so it’s a risk/reward trade-off we have to decide on.

NOTE: This article is not an investment advice. Any references to historical price movements or levels is informational and based on external analysis and we do not warranty that any such movements or levels are likely to reoccur in the future.
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Credit: FX Trading Lions

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