How to play odds in you favor in Forex trading? We present to you Forex trading tricks to increase profit. Do you use any of these?
AtoZForex – Trading in Forex is all about playing the odds. It is impossible to always win, this is the number one rule you need to remember. However, by playing the odds, or, we can say, trading the odds, you can significantly increase your chances of victory.
Forex trading tricks to increase profit
Trading the odds in Forex market requires self-discipline and patience. Moreover, you need to understand such concepts as market bias, key chart levels and stop loss order. Additionally, you need to master your trading strategy, as this will definitely help you succeed by trading the odds. Let’s dig in.
Feel for the chart
First of all, you should develop a ‘feel’ for a chart by developing a bias for the certain chart. You need to stick to this bias until it stops working. While observing daily market behavior, you will develop a feel for what is hot in the market. Moreover, you will be able to predict the market moves based on what has happened and the current market trends. That is how you develop the bias for your chart.
The key here is to develop a deeper emotional connection with the chart, and like this, your bias will tell you whether you should be looking to buy or sell. Once you have developed your bias, you are ready to trade the odds. For this, you need to stick to the side of the market until the trend is going to reverse.
In case the market continues is coming to an end, you will need to continue on the short side, thus playing the odds in your favor. Here you have got a Forex trading edge. Differently speaking, when the market is going down – don’t fight it. Your downtrend bias will be selling into strength, where your uptrend bias will be buying into weakness.
Key chart levels
Trading the odds in your favor means not just developing a bias and trading with it. Also, it means understanding key chart levels and how they let you play the odds. When a market almost touches a key chart level, it gives us a very good entry opportunity. Moreover, it provides a very good risk reward opportunity. Therefore, we are increasing our chances of making the profit by anticipating such an entry.
For instance, you have identified a key level, where everyone else is selling into it as price retraces down. However, this is your chance to buy. While people are selling into a major level and the underlying momentum is up, you are entering the market at your seller’s worst position. Thus, you are taking on their risk.
Furthermore, the risk reward is very advantageous at key levels. This is due to the fact that you are playing the odds. In case price rebounds from that level, you will have huge upside potential. Speaking differently, you will see small risk and a large potential reward.
Wider stops can help you
Wider than usual stops can be of a use when it comes to playing the odds in your favor. A lot of traders are trading with too small stop losses, as they want to trade a bigger lot. Yet, trading with too small stops has the opposite effect from what was initially planned.
A bit wider stop loss will help you to stay in a trade longer, allowing your edge to play in your favor.
Know your strategy from A to Z
Last, but not the least, trading the odds in your favor implies knowing your strategy by heart. Also, you should believe in your strategy and not doubt it at all.
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