Every successful foreign exchange investor must have a set of practical foreign exchange trading strategies. This set of trading strategies can ensure stable profits for investors. When investors are speculating in foreign exchange, they only need to act in accordance with their own trading strategies, which saves time and can make profits. Novices should also pay attention to the formulation of foreign exchange trading strategies when trading foreign exchange. So, how to formulate foreign exchange trading strategies?
The formulation of a foreign exchange trading strategy mainly involves the following steps:
Determine the transaction time.
When developing a trading system, you first need to confirm what kind of trader you are. Do you close your position on the same day or on a swing. Do you look at the chart once a day, a week, or a month? How long do you want to keep your position? These will help you determine the time frame for your trading hours.
Judge your own one-way method.
In terms of single direction, investors should first consider the short, medium, and long-term trends of the foreign exchange market, and decide which operation they are good at, so as to make arrangements. The essence of short-term trading is “broken”, such as a breakthrough after a long time, seek the best entry point from a technical point of view, and use short-term technical analysis of the basis for exit. The mid-line operation focuses on “volume”. The signals that reveal the relationship between volume and price in the market are very important, and analyze the trend in conjunction with the technical side as a basis for operation. Finally, there is the long-term. The long-term focus is on “potential”, that is, the trend of the foreign exchange market over a long period of time.
Clarify your own trading risks.
When creating a foreign exchange trading strategy, it is very important to determine how much loss you can afford for each transaction. The amount of loss you are willing to bear will be different from others. You need to determine how much breathing space your transaction requires, and don’t take too much risk on a transaction.
Fund management plan.
The overall funding plan is an important strategy that should be formulated after the operation method is determined. How big is the operating part? If you take the capital as a reference, what proportion should be invested in the long-term part, and what is the short-term part. In terms of capital management and control, there should be a long-term flow, and don’t make a desperate move. Careful capital planning should calculate the profit-loss ratio after operation in advance. In short, a sound management strategy is essential.
Stop loss setting.
The stop loss point should be set reasonably according to the operation mode, and the specific conditions of the long-term, mid-term and short-term should be analyzed in detail. There is also the setting of time stop loss. This situation should be carried out on the basis of predicting the duration of the band market. It is more difficult and requires rich market operation experience. Investors can learn from historical trends.