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
 |
Today the Federal Open Market Committy of the Federal Reserve ... Posted by: fxbootcamp
Video duration: 506 seconds Global video hits: 1502 Today the Federal Open Market Committy of the Federal Reserve Bank lowered the Fed Funds Target Rate to 1%. See how we traded it live using fibonacci studies, multiple time frames and intermarket analysis of the 10 Year T-Note. Live FOREX Training | EVERYDAY www.fxbootcamp.com |
 |
Russell Sands Turtle Trading Down Under - Part 3 of 10 Posted by: diversifiedts
Video duration: 510 seconds Global video hits: 2679 Veteran futures trader and forex trader, Russell Sands, explains turtle trading. Part 3 of 10. Russell offers investment advisories for both futures trading and forex trading. |
 |
( The Forex Signals ) Be The Top 1% Of Successful Traders Posted by: ForexRobotWorldCup
Video duration: 520 seconds Global video hits: 25524 www.The-Forex-Signal .com Blog Post http Check out all of the benefits of The Forex Signals and see how it is truly unique from any other signals service............. ....... ( The Forex Signals ) Be The Top 1% Of Successful Traders www.The-Forex-Signal .com Blog Post http... |
 |
75. How to Keep a Trading Journal - Forex, Futures, Stocks Posted by: InformedTrades
Video duration: 307 seconds Global video hits: 10259 www.informedtrades.c om A lesson on the 10 basic components of a trading journal for active traders and investors in the stock, futures, and forex markets. |
 |
FOREX VIDEO - ASIAN OUTLOOK JANUARY 20TH 2010 Posted by: fxbootcamp
Video duration: 291 seconds Global video hits: 980 Todays video is a trade plan based on the EUR/USD. Following the past 24 hours, the Euro is looking heavy to the downside and looks prime to test the recent lows from 2009. |
 |
Trading Forex, Nasdaq, and TSX with no input errors Posted by: TipsterOnForex
Video duration: 522 seconds Global video hits: 2033 Placing trades with Amibroker for stocks and forex using Interactive Brokers TWS interface. Trade the TSX, NASDAQ, and Forex without input errors! |
 |
Forex: Long and Short positions Posted by: nataliru
Video duration: 42 seconds Global video hits: 18108 Learn what LONG and SHORT positions mean on Forex |
 |
ForexPeaceArmy | Sive Morten EURUSD Daily 08.03.10 Posted by: ForexPeaceArmyCOM
Video duration: 327 seconds Global video hits: 3807 Professional Forex Trading analysis by Sive Morten with Forex Peace Army. Videos are recorded fresh daily to help forex traders stay profitable. |
 |
Part 2/4: Forex Outlook for April 26, 2010. Posted by: TraderPlanet
Video duration: 409 seconds Global video hits: 16 A complete look at the week ahead in forex trading including a review of the main equity, currency and commodity futures that will effect trading. See more trading videos at: www.traderplanet.com |
 |
FOREX VIDEO - ASIAN OUTLOOK NOVEMBER 10TH 2009 Posted by: fxbootcamp
Video duration: 446 seconds Global video hits: 898 Hello everyone. Looking for some Pound continuation to the upside during Asia today. A little rinse and repeat from yesterday. Good luck! |
 |
76. What Your Trading Journal Tells You - Forex and Stocks Posted by: InformedTrades
Video duration: 407 seconds Global video hits: 6582 www.informedtrades.c om A lesson on what successful traders look for when reviewing their trading journals for active traders and investors in the stock, futures, and forex markets. |
 |
ForexPeaceArmy | Sive Morten EURUSD Daily 08.02.10 Posted by: ForexPeaceArmyCOM
Video duration: 456 seconds Global video hits: 2696 Professional Forex Trading analysis by Sive Morten with Forex Peace Army. Videos are recorded fresh daily to help forex traders stay profitable. |
 |
Der Forex Millionaer - Video 079 Posted by: DerForexMillionaer
Video duration: 584 seconds Global video hits: 10272 www.DerForexMilliona er.de In meinem Blog berichte ich täglich darüber, wie ich versuchen werde innerhalb von nur 1 Jahr aus 1.000 Euro 1 Million Euro zu machen. Devisenhandel macht mich zum Millionär! |
 |
Forex, Futures, and Stock Market Daily Report Posted by: InformedTrades
Video duration: 310 seconds Global video hits: 3489 www.informedtrades.c om A daily report entitled all the data that matters for the stock market, futures market, and forex market. Lots of information for active traders of all kinds. |
![The best trading systems won\](http://i.ytimg.com/vi/XRF7-XVbVp4/2.jpg "The best trading systems won\") |
The best trading systems won't work with fear Posted by: TheTradingAuthority
Video duration: 582 seconds Global video hits: 982 The best forex trading system, the best futures trading system, and the best stock trading system are useless if you can't trade them confidently and be profitable. Fear, and the inevitable "fight or flight" response kicks in - universally among market traders. |
| 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 |
