If you’re new to forex and searching for forex trading strategies for beginners, then you may have noticed that there are literally hundreds of strategies to choose from. Choosing the right trading strategy from the get-go is one of the most important trading tips for beginners to follow, especially before you pick up any bad trading habits. In fact, in forex, it’s commonly believed that the beginner can learn how to become consistently profitable compared to seasoned traders who have been trading for years.
A newbie simply hasn’t had the time to try out a lot of strategies and pick up any bad habits. A trader who’s been trading in the forex market for years, struggling to find the right strategy will not only still need to find a strategy that works well for them, but they’ll also need to stop using poor strategy methods from the past that are outdated and provide poor results.
Making a Profit in the Forex Market
Here, we’ll go over some of the leading strategies used by some of the most successful traders in the market. These are easy to implement strategies that can be used by traders of all skill levels, which means they’re easy enough for beginners to handle.
Ultimately, when used consistently and correctly, you’ll find that your profits have increased virtually overnight.
Before you start practicing using new trading strategies, we recommend the Wall Street Forex Robot 2.0 Evolution. This is an automatic trading bot that will make trades on your behalf, based on parameters you’ve put in place. A trading bot should be used once you’ve chosen a successful trading strategy.
The Pin Bar
Hands down, most traders can agree that this is a strategy that’s perfect for beginners. It features a pattern that’s very obvious, which is what makes it simple to identify on a chart. Additionally, it’s also an easier strategy to trade.
However, while it does feature a simple structure, at times it can be tricky to trade if you’re not able to determine a bad pin from a good one. When it comes to pin bars, many traders tend to make the same mistake; they end up trading every pin they come across, failing to consider the context in which the pin bar formed within. Instead, the trader will continue to try trading counter trend pin bars. When it comes to trading bars there are several subtleties involved that the trader must understand if they want to make a successful trade.
The beginner needs to learn how to trade pin bars in trending markets. This is because any signal or price action setup will have a better chance of working with the momentum and power of a market trend to back it up.
Additionally, if you’re not able to successfully trade pin bars on daily chart time frames then you won’t be able to trade them on any lower time frame as well. Programs such as Forex Trendy will scan market trends across nine of the most popular time frames. This program can help you use the pin bar trading strategy more successfully, and it’s very beginner-friendly.
The inside bar is another effective trading strategy that beginners should use. The inside bar is best traded as a continuous pattern, unlike the pin bar trading strategy. This means you’ll want to use a pending order, which will allow you to trade a breakout in the direction of a trend.
This is a two bar candlestick pattern. This pattern is a clear indicator of price consolidation. You’ll need to see a candle on the chart in order to confirm this pattern, which will be contained within the previous bar. The inside bar candle will have a lower high and a higher low compared to the previous candle on the chart.
This pattern is pretty easy to spot on the chart, however, you can use an inside bar indicator in order to find the pattern more quickly.
Since the inside candle has a higher low and lower high compared to the previous candlestick, this will clearly indicate that the pair is consolidating. Once you’ve spotted this pattern, you’ll be able to draw a resistance level and horizontal support around the range, anticipating a breakout in the near future. Once the price exits the inside bar range, the price action should continue to move in the same direction as the inside bar breakout.
This trading strategy is basically a reversal trading strategy that can generate a big profit. The most important thing with price action trading is recognizing certain market patterns. This pattern features a couple of parts in its price pattern structure. In order to recognize this pattern, you’ll need to have a series of lower highs and a series of lower lows. Each of the lower points must be lower than the previous low, while each of the higher points should be lower than the previous high. When approaching the end of the pattern you’ll also notice that the price fails to make lower lows. Once the pattern develops the trader will notice that the length of the swing waves continues to become tighter and tighter. The two trendlines that connect the lows and the highs will converge at some point in the future.
This means you’ll need to wait until you’re able to spot the structure of the wedge pattern on the price chart before you make a trade.