We’ve all heard the saying, “the trend is your friend”. This is what every newbie is taught when coming in to forex trading. Sometimes this saying really makes me laugh. Actually, I’m laughing right now. And then there’s the other part of the saying, how’s it go? Oh yeah, “until the trend bends”.
Ahhh, ok, so basically I enter a trade as long as it’s trending, but exit when it starts to bend, simple! No wonder so many new traders get fooled into thinking this is an easy way to “gamble”. With zero to little education, one is probably better off in the casino anyway.
Having said all that, it IS possible to trade the trend successfully, even though it is one of the most difficult aspects of forex trading. It needs a number of factors, a good method, patience, consistency, and resolve in sticking to your trades no matter what (in the large majority of cases.
Often people use short swings to help with trend trading, and this is probably the best way to go, since you much more easily identify areas of support and resistance this way.
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“But there’s no doubt that my favorite tool for setting up trend following, swing entries is to use my 34EMA Wave. The Wave not only is the tool I use to identify the trend on my charts, but it also has the added benefit of acting as dynamic support or resistance at which I can look for swing entries. For anyone not already familiar with my Wave it’s simply three 34 period exponential moving averages, one on the high, one on the low, and one on the close.”
She expands on this by using intra-day examples from today’s charts on the lower timeframes.