Many traders prefer to buy dips to support or sell into resistance but this simply ensures they lose.

FOREX trading tips is all about using key indicators to confirm the move, rather than just assuming support and resistance will continue.

Let's look in more detail.

Buying Into Support and Sell Into Resistance.

You hear this tip all the time, but that does not make money.

It is based on the old adage "buy low sell high" which is another phrase that will not make you money.

If you buy into support or sell into resistance then the logic is that you will have a low risk and high reward if the rate continues.

The important word here is "if"

If you trade FOREX then you do not want to rely on "if" and hope - you want an indicator that will increase the likelihood of this level and holds your chance to make a profit.

If the price is speeding toward support or resistance then it will ruin all that often applies, so you need to see a change in price momentum and leading indicators which can help.

Getting the odds in your favor

If you want to buy support and sell resistance and get the odds in your favor do use the following FOREX tip.

You can use lagging indicators and trend lines in FX trading to show support and resistance areas and that we like are:

Bollinger bands and moving average.

Indicaotrs this as the trend line should NOT be used to enter trades.

When buying dips to support or sell into resistance, you want to confirm that the level will continue to be - before the price reaches this level of change you want to confirm in advance.

When price momentum turns above support or below resistance you can enter with an increased likelihood of success.

Indicators of the best time so far is stochastic.

See it and learn all about this because it is a great tool used below.

Another great indicator is the Relative strength Index RSI.

Combining the two and watch for the confirmation on both and you have a powerful combination that you can use to increase your chances for success.

They will give a warning before a change in momentum of price support and resistance, and when they turned into the order you choose, you can enter a trade.

You do not predict the above.

You act on confirmation and this will increase the odds dramatically in your favor and increase overall profitability.

FOREX is a tip is obvious, but surprising how many traders simply hope the level holds rather than looking for confirmation

Do not make the same mistake always act on the confirmation when trading FOREX

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Comments

2 Responses to “FOREX Trading Tip - Use Leading indicators For Greater Profits Here's How”

  1. taylor 22 on 15 Agustus 2013 23.25
  2. kunjungi blogku on 5 Oktober 2013 07.25

    mantap

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