How to know when to buy or sell in forex
Vicky I can give three answers to this:
First answer is you buy when you think the price of an instrument will rise, and sell when you think the price will fall.
Second answer is you sell when the price has reached a credible resistance level and buy when the price has reached a credible support level (buy the dip). See attached screenshot.
Third answer is you can buy after price has broken through a resistance level and you need to confirm this using various methods such as looking out for a confirmation candle. You could also sell when price has fallen through a credible support level; this is known as the breakout strategy.
No, there is no hard & fast rule on when to get & when to get out. It depends entirely on your trading strategy.
Also, for how long you should hold, it depends as well on your strategy. There is no straightforward answer in my opinion.
For example, if you have a strategy that tries to capture the momentum on US30 during US open, then you would get in before that with a small SL as per your strategy. And you will exit it based on your set of rules, like first opposite signal or profit based exit.
First decide what you want to trade & why? Are you familiar with how it moves, when it moves. Then develop a strategy that will give you an edge. An edge is when you take more money out than how much you put in.
And remember that your equity is everything. Don't lose it on punting on a single trade. Otherwise you will definitely lose it all.
If you use TradingView, they have some tools that can help you decide. One is the technicals summary tool which summarizes what all the indicators are saying on different timeframes and gives you a final suggestion on if you should buy or sell
It depends on your trading plan, some traders like to buy the dip meaning buy when price is falling. Others like to buy when price is rising
Just because the market is in a downward trend does not mean you should sell. I see many traders doing that because they say the trend is your friend. but they forget there's something called Dows theory, that says trends have phases and if you jump on a trend during its dying phase, you will be disappointed.
Just because the market is in a downward trend does not mean you should sell. I see many traders doing that because they say the trend is your friend. but they forget there's something called Dows theory, that says trends have phases and if you jump on a trend during its dying phase, you will be disappointed.
You are so right about this. That a trend is bearish doesn’t mean you should just click a sell. Personally, I love trading breakout levels no matter the trend. I will always wait for price at that level before executing any trade.
This question depends on the timeframe you are trading on. When I am trading on a 5-minute timeframe, I wait till I see 3 consecutive bullish candles before Ii buy and vice versa.
