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Forex trading strategies and risk management system

by anonymous

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Foreign exchange or currency trading is a highly lucrative and fast earning income source. The risk associated with it is also very high. Currency value fluctuation and improper portfolio management is a primary element of risk. There is no best method to manage risk in currency trading. One can use personal trading experience and analysis to reap out maximum profit or else automated trading systems are available which tracks a decade old data of currency fluctuations and its movement particularly. There are also various forex trading agencies who have experts to manage one’s individual forex investment and deliver return.


There are many naïve investors who loose money in trading due to intra day trading, unauthenticated and unreliable agents who promise to pay back unbelievable returns and forex robots (software ). The best way to stay in the game is personal involvement or engagement. Two strategies can be followed in deciding a time frame for deciding trading, one is swing trading or contrary trading and the other one is long term trading. In Swing trading one has to be bit disciplinary as one need to keep a tab on the daily movement of the trend and impact of various factors on the exchange rates. The other one is long term trading where one has to invest for a longer period as in months or years  to see the results. Analysis involves steady focus on chart formations, forex signals and trading movements.  The strategy to break trading ranges also do not need any trading forex signal information and it simply can be done with just trading prices. As long as the forex trading strategies will be simple , profit earning will be robust. Trading should be more on realty of price change and not on prediction. More focus on money management, need to hold on in the business in order to overcome losses.


The failure play strategy to forex trading helps to reduce huge loss or risk due to failing currency exchange rates. This strategy is based upon identifying key structure points by which one can entail 20 to 30 years old data for analyzing currency trend movement. Then can use a stop loss option to prevent currency failing to historical low and people selling away to avoid huge loss. The short selling on retracement strategy is adopted by people when a currency value is downgrading consistently and they suddenly found the currency value appreciating for a temporary period. Under normal circumstances, people sell to minimize loss. But, under this strategy forex managed account uses Fibonacci series calculation to understand the temporary gain and estimate future rise. This way one will be restrained from selling and wait for the right time to make profits while selling. Short selling and hedging strategy ensures that one’s investment in forex trading is immune to currency fluctuations. Future currency value is fixed based on present value as a result future fluctuation will not affect profits estimated.

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