Day trading is one of the most popular currency trade systems used by traders from all over the world. As this system provides daily profits and reduces the chances of losses that short-term trades involve, investors, like to incorporate the same while trying out their demo trading interfaces.
Amongst day systems for foreign exchange, here are the 3 best daily Forex strategies that will help people end their trading days with some extra dough on their hands.
1. Heikin Ashi Candlestick Trend Following Strategy:
In this method, traders will have to switch to the Heikin Ashi candlesticks which offer smoother movement with less noise. The pair to trade with this system is the EURO – USD currency duo.
Firstly, traders will have to look for where the trend is moving; Upwards, downwards, or sideways? Once that is confirmed, they are almost ready to incorporate this strategy.
Trade entry should commence when a medium to large Heikin Ashi candle changes color plummeting up or down dissecting the 8 WMA and 14 MA line. Traders must remember to check whether both the lines have been crossed.
During candle close, traders can enter a long or short trade depending on the trend.
*Note: Going long means to buy low and sell high; Going short means to sell high first as traders are expecting a drop.
2. Daily Chart Price Action:
Considered by some as the best daily Forex trading strategy, this is by far one of the simplest yet effective methods of daily trading.
Traders have to shift to a day time frame from any lower ones and then look at the trend of the price. After trading the support and resistance lines in this time frame, they are ready to enter a trade position. The best point of entry is as close to the daily support line as possible. This way, once there is a breakout through resistance, traders can make a lot of profits. Also, it decreases your frequency of trading because of a longer time frame and reduces risks of losing fast and repetitively.
The reason traders think this is the best daily Forex strategy is that it shows less false indicators that are one of the main drawbacks of lower tim+e frames.
3. 50 Pips a Day Strategy:
Counted among the best daily Forex strategies this works best for the UK time frame and GBP USD currency pair. Traders have to set a pending buy and sell order before the opening of the session at 7:00 GMT. Once the trade opens, one of the orders will activate because of the price trend; cancel the other immediately.
Set a take profit to move at 50 pips above your buy and exit once with your yield.
An example would be if a trader enters the trade at 1.6750, then s/he should set take profit target at 1.6800.
After learning these best daily Forex strategies, daily trading time frames should be your go-to system while trading currencies in the market. Also, it will make it less likely for you to lose more money when failing in shorter time frames.
The content of this article reflects the author’s opinion and does not necessarily reflect the official position of LiteForex. The material published on this page is provided for informational purposes only and should not be considered as the provision of investment advice for the purposes of Directive 2004/39/EC.