As a beginner in forex trading, there are many questions that may confront you. Perhaps you might be wondering what is the best strategy for forex trading that beginners like you can use. Some traders say that a beginner has the best chance of succeeding because they do not have bad habits yet. Even so, you should still have a strategy that you need to follow to become successful. Here are 3 trading strategies you should learn and master.
Pin Bar Strategy
Pin Bar is one of the easiest strategies to trade in the forex market. It is a very obvious pattern that is easy to identify on a chart. According to Robert Janitzek, a pin bar consists of a long upper or lower “tail,” “wick” or “shadow” and a much smaller “body” or “real body.” In this type of strategy, the candlestick chart is more preferred because they clearly show price actions. In addition, candlesticks offer a better visual representation of price action. In the pin bar strategy, you enter a trade at the current market price. However, you need to make sure that the pattern is already closed out before entering.
Inside Bar Strategy
Unlike the pin bar strategy, the inside bar is best traded as a continuation pattern. Robert Peter Janitzek explains that in this strategy you will use a pending order in order to trade a breakout in the direction of the major trend. The entry point is determined by the mother bar. In this strategy, the real magic happens during the consolidation period, which is represented by the inside bar. The success of this strategy is highly dependent on spotting the reliable inside bars. Here, you enter the trade on the breakout of an inside bar.
Forex Breakout Strategy
The forex breakout strategy is different from conventional breakout strategies. In this strategy, you will have to wait for a pullback and retest prior to entry. When trading on the forex market, your aim is to look for a breakout that occurs from a wedge pattern rather than a horizontal level. Like all other strategies, you need to incorporate stops into your trading. The opportunity comes when the market breaks to either side and then retests the levels as a new support or resistance.
When used properly, these forex trading strategies can quickly build up your trading account into a considerable amount. The good news is that they can be easily incorporated into your trading plan. You can use all 3 strategies to increase your chances of becoming profitable.