Forex Trading Videos

Home

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

Fibonacci - Technical Analysis - Currency Forex - Fx Trading - Daytrading - Retracement - Signal Trading - Forex Training - Demo Trading - Forex Trading Platform

Other videos by this author:

	Study Skills: Don't mistake activity for achievement. Posted by: MathTV Video duration: 79 seconds Sometimes we spend lots of time looking like we are studying, but are we really?

	Calculus Help: Tangent Line 2 Posted by: MathTV Video duration: 237 seconds Another example of finding the equation of the line tangent to a graph at a specific point.

	Calculus Help: Tangent Line Posted by: MathTV Video duration: 165 seconds Finding the equation of the line tangent to a graph at a specific point.

	If you think you can . . . Posted by: MathTV Video duration: 242 seconds Sometimes we are actually on a different path than we think we are on.

	Algebra Help: Simplifying Radicals 3 Posted by: MathTV Video duration: 242 seconds These are the expressions we need to simplify when we solve quadratic equations using the quadratic formula. This video is also on www.mathtv.com in Section 8.3 of the elementary algebra book.

	Algebra Help: Simplifying Radicals 2 Posted by: MathTV Video duration: 271 seconds More expressions that involve radicals and fractions. This video is also on www.mathtv.com in Section 8.2 of the elementary algebra book.

	Algebra Help: Simplifying Radicals 1 Posted by: MathTV Video duration: 293 seconds Simplifying some fractions that involve radicals. This video is also on www.mathtv.com in Section 8.1 of the elementary algebra book.

	Algebra Help: Inequalities Posted by: MathTV Video duration: 295 seconds Understanding the properties we use to solve inequalities. This video is also on www.mathtv.com in Section 2.8 of the textbook Elementary Algebra.

	Algebra Help: Squaring Property of Equality Posted by: MathTV Video duration: 442 seconds Understanding the squaring property of equality. This problem is also on www.mathtv.com in Section 6.5 of Intermediate Algebra.

	MathTV on Facebook Posted by: MathTV Video duration: 64 seconds MathTV is now on Facebook. And we have made more progress with our online textbooks at www.mathtv.com/onlin ebooks.

	Sequences 10: Fractals and Chaos Posted by: MathTV Video duration: 827 seconds

	Calculus Help: Integrals 11 Posted by: MathTV Video duration: 288 seconds

	Trig: The Three Definitions are Equivalent Posted by: MathTV Video duration: 355 seconds We show that the three definitions we have for the six trigonometric functions are equivalent to one another.

	Do Something for the Person You will be in 5 Years Posted by: MathTV Video duration: 208 seconds If you are looking for something to do to in the new year that will help point you in the direction of success, you may want to arrange your life so that you are doing something for the person you will be five years from now.

	Calculus Help: Limits 7 Posted by: MathTV Video duration: 279 seconds Finding a limit by squeezing it between two other limits.

	Calculus Help: Limits 4 Posted by: MathTV Video duration: 603 seconds Limits involving rational functions.

	Calculus Help: Limits 3 Posted by: MathTV Video duration: 234 seconds When can we simply substitute to find limits?

	Calculus Help: Limits 2 Posted by: MathTV Video duration: 414 seconds The limit theorems give us a shortcut to finding limits. With limit theorems we do not need to use the epsilon/delta definition to find limits.

	Calculus Help: Limits 5 Posted by: MathTV Video duration: 138 seconds Finding the limit of a rational function at a point at which it is undefined.

	Calculus Help: Integrals 10 Posted by: MathTV Video duration: 266 seconds An AP Calculus problem involving the area between two curves.

	The Golden Ratio in 1150 Posted by: MathTV Video duration: 312 seconds The mathematician, al-Samawal, working in Baghdad, Iraq, around the year 1150, gives an expression for the Golden Ratio that looks much different from the expression we use. Is he correct?

	The Equation of a Line Posted by: MathTV Video duration: 276 seconds Finding the equation of a line given the slope of the line and one point on the line.

	Algebra Help: Square Roots Posted by: MathTV Video duration: 358 seconds Taking the square root of a perfect square.

Calculus Help: Limits 1 Posted by: MathTV Video duration: 373 seconds More videos at http://www.mathtv.co m. You can help keep the videos under the Videos by Topic tab at mathtv.com free by clicking on any of the Amazon ads that appear below the video screen on mathtv.com. Anything you buy during that session will help keep the Videos by Topic tab free on mathtv.com. Thanks ahead of time for doing this.

	SAT Math Exam Help: Roots of an equation. Posted by: MathTV Video duration: 188 seconds A problem from a sample SAT exam.