Download 42 Forex, Bitcoin and and stock market trading books free of charge, including fundamental and technical analysis books. Browse our free Forex guides or easily compare forex trading for dummies free in one place. Download a free crypto-currency ebook at Fortrade. Trading foreign exchange, contracts for differences or spread bets on margin carries a high level of risk and may not be suitable for all investors.
You could sustain a loss of some or all of your funds if the markets move against you. For this reason, you should not invest more than you could afford to lose. New customers: click to call or email these brokers’ sales teams directly, and visit their website. In order to do that, there is one very important thing we must know about the market.
We want to know is what the trend is. Remember that there will be a different trend on each time frame and it is perfectly acceptable to have a downtrend on a 4 hour chart and an uptrend on the daily chart. In order to objectively determine the trend on the time frame of our choice, we are going to use the exponential moving average indicator that every charting platform will have. Why the 200 and not another one like the 50 EMA or the 20 EMA?
Because 200 EMA is one very popular Forex indicator used by lots of traders and is used to determine the main underlying trend regardless of any corrective move in the price action. When price is above the 200 ema, that’s an uptrend. THE 200 EMA TRADING STRATEGY AND HOW IT WORKS The 200 ema strategy is a multi-timeframe forex strategy which means you need the daily chart, the 4 hr chart and the 1 hr chart. Place the 200 ema on the daily chart of your Forex pair. See if its and uptrend or a downtrend. The daily chart determines the main trend. Switch to the 4 hr chart and see where the 200 ema is relative to the price, is it in the same trend as the daily chart.
If yes, switch to the 1 hr chart and check if the 1 hr chart is in the same trend as the daily and the 4 hr charts. It is in the 1 hr chart where your trade entries are executed when the trend in the 1 hr chart is the same as the 4 hr and the daily charts. 200 EMA Trading System Rules Once price lines up on the right side of the EMA on all charts, we look to trade bounces from the 200 moving average. We will use long trends for this example. Use price action by the use of reversal candlesticks. Click this link on what reversal candlesticks to use.