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What happens when the market approaches recent lows? Put simply, buyers will be attracted to what they regard as cheap. What happens when the market approaches recent highs? Sellers will be attracted to what they view as either expensive, or a good place to lock in a profit. Therefore, recent highs and lows are the yardstick by which current prices are evaluated.
We are a group of Forex traders and Fund managers with over 8 years experience trading in the Forex market. We have mastered every technique from Fibonacci trading, Support and Resistance trading, Divergence trading, Breakout trading, Pattern analysis, Elliot wave, VSA, Price action trading to trading Fundamental Analysis and our aim at LFM is to pass on that knowledge.
Highest profits are realized only when the best forex trading strategies are employed by the forex traders. There are many time tested forex strategies that can be used by serious traders. Whereas some of them are based on the effect of the current political and economic scenarios of a country, some others rely on charts and numbers that are based on past performances of the forex market. All the strategies that are explained briefly in this article have different levels of complexity. It is also important to note that whatever may be the strategy that the forex trader wants to apply, the best effects occur only when the trader has sufficient knowledge and experience in the field. This article aims to familiarize the readers with a few well-known forex trading strategies.
Backtesting is a kind of a strategy test performed on the past data. It can be either automated or manual. For automated backtesting, a special software should be coded. Automated testing is more precise but requires a fully mechanical trading system to test. Manual testing is slow and can be rather inaccurate, but requires no extra programming and can be done without any special preparation process. Any backtesting results should be taken with a grain of salt as the tested strategy might have been created to fit particular backetsting historical data.
This method is all about analyzing important news happenings on different fronts in a nation and understanding the implications that they will have on the currency market. The trader will then place the trades accordingly. The market moves in an unpredictable manner when there are sudden political or economic happenings in any nation. As the forex market operates round the clock, news flows in from all parts of the world. Trading on the basis of economic news and data suits all kinds of traders wherever they are and whichever currency they choose to trade.
However you decide to test your strategy, you need to understand the results you get. Intuitively, you would want to judge the results according to strategy's profitability, but you should not forget about other important parameters of successful trading strategies. They are: low drawdown sizes, short drawdown periods, high probability of winning, high average reward-to-risk ratios and big number of trades. Ideally, your system should earn equally well on bullish and bearish trades, the resulting balance curve should be consistent and uniform, without significant drops or long flat periods.

Some of the other best forex trading strategies are based on the technical analysis. This method is particularly important in day trading. Technical analysis is useful to traders in that it gives them an indication of times when they can enter or exit the market. It also helps the trader to make the most out of the existing market status. Given below are brief explanations of some of the technical analysis based trading strategies.


Starting as a student of FMP back in 2011, Pierre studied hard and now trades Forex full time from his home in South Africa.  Pierre teaches his unique Earth & Sky Trading System. Every day he provides updates as to what he is looking to trade for those following his trading strategy. Its a step by step process so its great for beginners & experienced traders alike.
The main categories of forex strategies used by traders include: Fundamental Strategies, Technical Strategies and Popular Strategies. Fundamental forex trading strategies are dependent on the fundamental economic indicators of a nation and other political events that happen in a nation. Technical forex trading strategies rely on the statistical and mathematical models of the currency prices and the analysis thereof. Popular trading strategies are always a combination of the fundamental and technical analyses.
Shirley promptly picked up the telephone, as she must have thought that I might have wanted to hire her as a realtor. I told her that I was confused, why is she selling real estate and hustling to make a buck when her trading track record reveals that she is one the most profitable traders on planet earth? Our conversation quickly went downhill. She then refused to speak with me further and requested that I contact Vic Noble about the supposed returns on investment.
For this strategy, we will use the Exponential Moving Average (EMA) indicator. The previous week's last daily candlestick has to be closed at a level above the EMA value. Now we have to look for the moment when the previous week's maximum level was broken. Next, a buy stop order is placed on the H4 closed candlestick, at the price level of the broken level.
Arbitrage is based on the premise of the forex trader trying to make a gain from small differences (of the currency) that exist either in the same or different markets. This is primarily a form of speculation. Identifying the right conditions and employing this strategy is not an easy task. Arbitrage strategy best market participants who have best technology systems and have quickest access to information. Arbitrage is best employed when the same currency has two different prices.
What happens when the market approaches recent lows? Put simply, buyers will be attracted to what they regard as cheap. What happens when the market approaches recent highs? Sellers will be attracted to what they view as either expensive, or a good place to lock in a profit. Therefore, recent highs and lows are the yardstick by which current prices are evaluated.
But the supposed educational programs and private mentoring continues to be sold. A hotbed of “get rich quick” Forex trading indicators and magical trading methods. The marketing showpiece is a supposed professional trader named Shirley Hudson. She provides a spreadsheet of “100% real trades” as marketing bait. The spreadsheet contains nearly 7 years of non-stop, continuous winning day trades. Pure marketing chicanery. It turns out that Shirley Hudson is nothing more than a hardscrabble Realtor operating out of Washington State.
Scalping - These are very short-lived trades, possibly held just for just a few minutes. A scalper seeks to quickly beat the bid/offer spread, and skim just a few points of profit before closing. This strategy typically uses tick charts, such as the ones that can be found in MetaTrader 4 Supreme Edition. This trading platform also offers some of the best forex indicators for scalping. In addition, the Forex-1 minute Trading Strategy can be considered an example of this trading style.
Divergence is a tool that helps the traders to learn the price behavior of the currency. This analysis generates patterns that will help to predict the direction of movement of the currency rates. Divergence, a leading indicator, helps traders to significantly increase their profits. This is because the likelihood of trading in the right direction and at the right time increases if this indicator is used along with others such as Moving Averages, Stochastics, RSI, Support and Resistance levels, etc.
However, it's important to note that tight reins are needed on the risk management side. These Forex trade strategies rely on support and resistance levels holding. But there is also a risk of large downsides when these levels break down. Constant monitoring of the market is a good idea. The market state that best suits this type of strategy is stable and volatile. This sort of market environment offers healthy price swings that are constrained within a range. It's important to note that the market can switch states.
For this strategy, we will use the Exponential Moving Average (EMA) indicator. The previous week's last daily candlestick has to be closed at a level above the EMA value. Now we have to look for the moment when the previous week's maximum level was broken. Next, a buy stop order is placed on the H4 closed candlestick, at the price level of the broken level.
This method is all about analyzing important news happenings on different fronts in a nation and understanding the implications that they will have on the currency market. The trader will then place the trades accordingly. The market moves in an unpredictable manner when there are sudden political or economic happenings in any nation. As the forex market operates round the clock, news flows in from all parts of the world. Trading on the basis of economic news and data suits all kinds of traders wherever they are and whichever currency they choose to trade.

Fair Value strategy made use of in various financial markets. In the forex market, the fair value of a currency is determined based on the economic situation in a country. In order to use this forex strategy, traders must have an understanding about a few basic related to the economy, especially the GDP growth of the two economies whose currencies they plan to buy and sell. Other aspects to be considered include the unemployment rate and the inflation data. 
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