Forex Trend Trading With a Simple Moving Average
By Nathan Navachi
While many new forex trading systems are based on complicated mathematical market analysis models, some of the most effective forex trading strategies are also the simplest. One of these simple and highly effective strategies is trend trading, where you simply see which direction the market is trending in and then you trade in that direction. If you were trading the EUR/USD currency pair, the way that you could identify the direction of the trend is to open up a daily chart and overlay a simple moving average on the chart. If the direction of the moving average is up, then the pair is in an uptrend; if the moving average line is down, there is a downtrend; and if the line is horizontal then there may be no trend.
Trend trading is a proven way to earn profits in the forex market since it is an established fact backed by decades of market research that currency pairs (and indeed literally all markets) move in trends. If the trend is up then it makes sense to buy, if the trend is down then it makes sense to sell, and if there is no trend then it may not be a good time to trade. The best way to get an accurate sense of the overall trend is to look at a long-term price chart such as a daily, weekly, or monthly chart and see which direction the moving average line is pointing. While it may not be practical to use a monthly chart for trading signals, it can let you see in a quick glance where the market has been and where it will be headed if the trend continues.
It is a general rule of interpreting trading signals that the longer the period of the price chart is, the more reliable the trading signal will be. This strategy of determining the trend and then trading in that direction could be used on a chart as small as a one minute candlestick chart or as large as a daily or even weekly chart if you are really a long-term trader. Now while trading signals from long-term charts can be more reliable, there is also larger risk involved with keeping a trading position open for days or weeks at a time. If you plan to trade on these types of longer time frames, be sure to factor in the amount of leverage you are using as a function of how many pips you are willing to risk on a loss.
On the short-term side, this strategy can be used on a 1-minute or 5-minute chart but the signals may not be as reliable and the trend itself may be erratic and rapidly changing. It is common sense that the steepness of the moving average line indicates how quickly the market is moving up or down, and if you can identify a fast moving trend on this type of price chart then you open yourself up to large gains if you can enter in on the right side of the market and ride the trend for as many pips as possible before the market retraces itself.
The easiest way to learn forex trading is by watching videos. Go to this YouTube video and watch a video commentary for this article.
Nathan Navachi is a professional trader who built http://TheCurrencyMarkets.com as a valuable resource to introduce the world to the forex market.
Article Source: http://EzineArticles.com/?expert=Nathan_Navachi
http://EzineArticles.com/?Forex-Trend-Trading-With-a-Simple-Moving-Average&id=2690813
 |
Day Trading Part 1 Platform and charting software Posted by: DayTraderRockStar
Video duration: 307 seconds Global video hits: 111233 a basic intro about the trading software i use, the price i pay to use this is 0.00 and it works as great as services you pay 50.00 a month for. |
 |
Day Trading 1.29 Part 1 Live Stock Trading Posted by: sgomez858
Video duration: 659 seconds Global video hits: 11818 www.todaytrader.com. Online trading or stock day trading is best to learn by watching live videos. My name is Steve Gomez. My partner Andy Lindloff and I are day trading for a living Learn from our winners and also our mistakes from the trading day. Trading from home can be done using software... |
 |
Day Trading Methods So Easy Anyone Can Use Posted by: daytradetowin
Video duration: 3679 seconds Global video hits: 823 Trading price action with John Paul on the morning of 12-15-11. The Founder of Day Trade To win conducted this live webinar and demonstrated how easy it was to use the Atlas Line trading software as well as the ABC method of trading on the emini SP and Euro Currency |
 |
Price Action Day Trading Webinar - Futures, Currencies and Forex Posted by: daytradetowin
Video duration: 4124 seconds Global video hits: 2360 www.daytradetowin.co m shows how to daytrade price action on every futures, forex and currency market. don't miss this how to day trading webinar presented by day trader system educator John Paul |
 |
The Best Interval For Day Trading Charts is ZERO Minutes! Posted by: TopDogTrading
Video duration: 619 seconds Global video hits: 110468 I receive this question a lot: "What's the best interval for day trading charts?" In today's video I not only answer that, but give, what may be to some, a very surprising answer: Don't use intervals of ANY minutes! |
 |
Demo Forex Trading - Forex Tutorial - Day Trading For Dummies Posted by: ForexPractice
Video duration: 236 seconds Global video hits: 5833 www.forex-made.com Open Free Trading Account. eToro - World Leading Forex Trading Platform. Open A Free Practice Day Trading Account. Join now and get these benefits: * Free practice account with real time rates * Up to $1000 on your first deposit * Personal trading coach and... |
 |
7. Day Trading and Investing: Charting Patterns Lesson 1 Posted by: InformedTrades
Video duration: 237 seconds Global video hits: 83667 www.informedtrades.c om The first lesson in a series on chart patterns for traders and investors in the stock market, futures market, and forex market. |
 |
Online Trading Live Day Trading Tips for Jan 8 Part 1 Posted by: sgomez858
Video duration: 654 seconds Global video hits: 18017 Online trading or stock day trading is best to learn by watching live videos. My name is Steve Gomez. My partner Andy Lindloff and I are day trading for a living Learn from our winners and also our mistakes from the trading day. Trading from home can be done using software that has Level... |
 |
Day Trading Tips: The Most Reliable Time Interval for your Charts Posted by: TopDogTrading
Video duration: 617 seconds Global video hits: 26347 www.TopDogTrading.co m Day Trading Tips How to Choose the Best Time Interval for Your Day Trading and Swing Trading Charts for stocks, stock market, Forex, futures or emini. |
 |
Scalping Lesson; 40 Ticks on Crude Oil Day Trading E-Mini Posted by: SchoolOfTrade
Video duration: 592 seconds Global video hits: 6340 Support FORUM Link: forums.schooloftrade .com PLEASE RATE & COMMENT ON THIS VIDEO! JOIN US TOMORROW IN OUR LIVE TRADE ROOM, OPENS @ 245AM (EST), HERES HOW: www.youtube.com |
 |
FIFA 11 Ultimate Team - Day Trading with Japes Posted by: airjapesfifa
Video duration: 383 seconds Global video hits: 21635 Hey guys, a little thunderstorm yesterday prompted me to do some day trading! So, this is maybe over about 2 hours while I was watching a movie... If you guys like seeing this let me know! These are really really easy for me to do, and I have no problem showing you guys the kind of buys that I get! PS: Sahin ended up going for 66k! Puts me at 527k Twitter: twitter.com/airjapes fifa |
 |
DayTrading with less then 25k Posted by: DayTraderRockStar
Video duration: 649 seconds Global video hits: 37647 Trading futures with less then 25k one example of a set up |
| Page: 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 |
