Free Forex And Gold Signals

Dear friends,

These are my 8 basic rules summary from the famous Trend Following System. Bear in mind, this is just my summary. It can be truthfully right or simply dead wrong.

1. Keep it Simple – Simple systems work best, because they have fewer fundamentals to crack than complicated ones and are more robust, in the vicious world of trading. Complexity and intelligence have no place in seeking forex takings – keep it simple and you will boost your odds of success.

2. Support and resistance – Support and resistance are plainly levels that have been tested more than twice and allow traders to segregate areas of value, to execute trading signals against. While trading systems look for support and resistance levels to grasp (and trading against them can be profitable) there is a more profitable way of using support and resistance.

3. Breakouts – If valid support and resistance levels break, you have a breakout on your forex charts and using breakout method is one of the finest ways to make forex profits. Most major trending moves take place form new market highs or lows and if you go with these breakouts, you will seize some of the best trends.

4. Following the trend - Once a trend is in shift you have to follow it and stay with it. Following a trend is not simple, as you will always have volatility present and pullbacks. You must choose if they are simply retracements inside the trend or trend reversals. To do this, you need to decide what normal volatility is and what trend reversal is.

5. Spotting trend reversals – Human nature tends to cause short term price spikes away from fair value. These spikes are short lived and prices quickly return to fair value. These spikes can be of various sizes but they never last long. Look for it and use technical indicators to trade contrary to the move and get in at key market reversals. Simply, when the trend is in motion your aim is to stay with it – when prices spike to far from fair value you will look for contrary trades and the above is easily spotted using technical analysis and forex charts.

6. Conforming trading signals – The best trading systems all confirm with momentum indicators which show that price velocity is shifting. For example, if prices dip to support, you don’t just buy – you wait for momentum to move away from support and then perform your trading signal when they have confirmed support has detained. This way you are trading the reality of the level holding, rather than simply hoping or guessing. If you do this – you will put the odds in your favour.

7. Exit points and volatility - Any forex trading system which is victorious takes into account price volatility. This will allow you to place your stops (and trail them) outside of random volatility, stay with trends and spot potential reversals. One of the major dilemmas for successful trading systems is – to place and trail stops for optimum risk / reward and an understanding of volatility is important to do this.

8. Understanding confidence and discipline -Building a trading system to successfully follow forex trends is easy, but the catch is you must have confidence to apply it with discipline, when you hit a losing streak. If you don’t have the discipline to apply your trading technique you simply don’t have one.

So if you want to make money forex trend following – use a simple system, which is robust, trades the odds, that you understand, be able to apply with discipline and you can enjoy currency trading success.