Basic Trading Strategies
The trading methods are suggestions based upon the experience from many of our customers. You have to find your own rhythm in trading using TrendProphecy FX, and most importantly, forget the 'old' way of trading. Remember TrendProphecy FX differs from other systems in that it does not attempt to predict a future price. Instead, TrendProphecy FX attempts to determine when the current trend changes and if that should lead to a change in position.
- It is NOT a great idea to stay in a position until it changes. It is not a fault by TrendProphecy FX that the price development by the end of a position can go against the original position. Contrary, it is in the nature of the way the TrendProphecy FX algorithm is developed, to find a good entry point that is trustworthy, the trend has to be confirmed, and that is why TrendProphecy FX very often end up with a loss if you stayed in the original position.
- TrendProphecy FX computes almost every time a new trading signal with a huge possibility for a profit, because TrendProphecy FX finds a profitable entry point into the market, either long or short. It is then up to the trader to take advantage of that during the originally position to take home a profit. When to close the position is up to you as the trader.
It is important to trade very close to the Trade -or Alert Price TrendProphecy FX shows. If that is not possible within few minutes from receiving the signal, wait for a new Trend Change or Alert.
- Trend Change always means a new trade. The Trend Unstable is not the same as a Trend Change because the Trend can still go back to stable, which is why the Conservative Trader if he has not been able to close and take profit should still stay in the position even if the Trend Unstable is shown and point to where an eventual change will happen, as the Main Trend is still intact until a confirmed Trend Change happens.
If the Conservative Trader on the other hand has already taken a profit - as he normally should following TrendProphecy FX's trading Philosophy - he can use the return to Stable as a signal to re-enter the same Trend, but have to be ready to close even with a loss if Trend Unstable signal returns.
Aggressive Currency Scalp Traders however, should use the Trading Alerts to close the current position if it has not been done already, and then wait for either the signal to change back to Trend Stable for re-entering the position again, or take a position against the Main Trend or wait for a confirmed new Trend Change, see also the trading example.
- Instead of using market orders use limit orders.
Because you have to wait until the trend is confirmed, you will sometimes experience that the market goes away from you. The problem lies in the nature of the Internet, the speed of your Computer and how and when TrendProphecy FX is able to compute the advice. Even if you have the fastest connection money can buy, you still have to wait for the Signal from TrendProphecy FX, which is being computed at the time where the price pattern is recognized as a trend change. The result will normally be within 1-3 seconds after the price pattern is recognized.
Put in a limit order on or close to the Price TrendProphecy FX shows you as the trade price, and wait for it to get filled. If it is not filled within a few minutes, delete the order and wait for another signal or alert, there are always a new trade coming up later.
- Another trade strategy is to trade more than one time, the first as close as possible to the price TrendProphecy FX has traded on. If the market still goes against the original position and an alert Trend Unstable is called, trade again if/when the alert is lifted on a price close to the price when the Stable sign returns. As you will see from experience, that price very often in the early state of the position (only in the early state) acts as a heavy resistance point.
- Trailing Stop Profit protects a profit, but let a winner run as long as possible. The most basic technique for establishing an appropriate exit point is the trailing-stop technique. Very simply, the trailing stop maintains a stop-Profit order at a precise percentage or number of pips below the market price (or above, in the case of a Short position).
The trailing stop, as a part of your exit strategy, is a stop that moves in the direction of the Trend, which is up for a long trade and down for a short trade. An ideal stop is one that allows enough "room to move" and hence allows the profits to run.
The stop-Profit order is adjusted continually based on fluctuations in the market price, always maintaining the same percentage or points below (or above) the market price. The trader is then "guaranteed" to know the exact minimum profit that his or her position will garner.
Trailing Stop Orders are a helpful way to not only protect a position, but to protect what you might gain as well.
Using Trailing Stops instead of using fixed profit goals and thereby taking advantage of longer Trends would make the profit rate much higher depending on the administration of the stops.
- Combination means that you are trading different Pairs at the same time, either by following a hedging strategy or simply trying to follow a signal if/when two, three or more Pairs are in sync.
As you will see from the daily trading, most of the time the Pairs are in sync within few minutes which means that it's pretty difficult to follow a traditional hedging strategy trading currency.
Combining two or more Pairs in a hedging strategy is not an easy trading method, and should only be done if you are a very experienced trader.
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