Profits in foreign exchange are all about closing higher than the opening price. Here’s something that every single trader out there needs to understand though. Opening and closing trades has more to do with the opening and closing prices which come into the picture. Instead of just knowing how to use Forex Open Close indicators, what’s more, important is getting a proper idea on how to go forward with the trades in the first place.
Explaining Open-Close specifics:
There are more than a few things which come into the picture while judging market volatility. A lot does depend on an overall average of opening and closing prices with respect to that specific time frame.
While judging this, the most common pointer which often goes beyond account is transaction volumes. More often than not, both these factors play in comprehensively when it comes to judging how liquid the market situation actually is.
This is the first and foremost pointer for judging Forex open close. Every single trade should be accounting for both these pointers before expecting to make an accurate anticipation or forecast of the market conditions.
To continue from a previous pointer, there are some typical technical tools or indicators which traders use for coming up with a proper reading on market liquidity. Tools such SMAs and EMAs, as well as MACDs, are those used more commonly.
All these indicators show both an average of opening and closing prices against a median of the price action in the picture. The point is, they do not factor in these volatility pointers along with the transaction volume.
This is just what every single trader out there needs to do for getting a more comprehensive output from the market. Considering every single variable which does affect market conditions is what matters. That is just what needs to be done.
So, for getting a more proper angle on forecasts, opening and closing prices need to be put in the right perspective.
Using Price action Historical Data:
Historical data is one of the most vital pointers which every single veteran out there resorts to in one way or the other. Every single currency pair has certain limitations to price action which are more than obvious. This depends a lot on their pip size along with overall trader sentiment or mentality towards it.
Historical data can help a trader get a proper pattern of future price action as per current strings of opening and closing prices. This can help traders with the most basic of functions such as gauging a proper idea on how to come up with a proper Stop Loss orders.
Further, opening and closing positions also play a big hand in the final profits. Considering that every single of these positions is directly relative to a certain time frame; final profits have a lot do with how a currency closes at one point of time.
Forex open close is more conceptual than about numbers. The right concept, however, plays big in getting the right profits.
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.