This simple 5-step strategy will help you simplify your trading with steady profits. Trading strategies do not need to be complicated to be highly successful. In fact, simple trading strategies have proven over time that they are more successful in those very complex strategies. The reason for this paradox is that simple strategy is easier to follow and easier to implement.
Follow the five-step strategy:
1. Check the trend using the daily chart. The chart should tell you whether the market is bullish or bearish.
2. Once you know the trend, check out the basic news releases that may affect your trade. Do not go to any of the following steps if there are any major newsletters within two hours of your trade. You can get current economic news from the financial market news summary of your choice.
3. If there is no news within two hours of your trade, execute your trading plan. For example, if the major trend is bullish, look for "Buy" signals from the technical indicators and vice versa if the main trend is on the downside.
4. This is the most important step and your decision regarding entering the trade here. The common strategy is to use the intersection of 4 EMA (exponential moving average) and 23 EMA on the 30-minute chart to determine whether to buy or sell. You should use other indicators such as the Weekly Axis, Stochastic and MACD (Moving Convergence Moving Average) to confirm your trade. These indicators should also follow the trend and not look flat. You can boost the trade to your advantage by trading only during high liquidity sessions and confirming the trend using a 4 hour chart. If everything looks good, you're done!
5. The last step to manage your money by controlling the trade by stopping a tight loss of about 35 points while using one of two profit targeting methods. The first is to use a health risk reward ratio of at least 1: 2 and the second is to use daily support and resistance.
As you can see, a good trading strategy doesn't have to be complicated to succeed. By simplifying your trading strategy, your chances of successful trading are greatly increased. This 5-step strategy should help you make steady profits with your trading