Effective Forex Online Trade Techniques

By Gergios Vergakis - on February 4, 2016

Traders develop effective forex online trade techniques for gaining an edge in the currency market. Some of these techniques are remarkably clever and unusual.

Effective Forex Online Trade Techniques Traders Use

All profitable traders have chosen specific markets to trade. Markets such as the forex market, where hey can apply their forex online trade techniques and ideas. Such online trading requires good forex trading strategies and methods. Trading becomes very specific on factors such as time zone, daily trend momentum, central bank interventions, and more. Time zones alone allow traders to figure out whether any given currency pair has a tendency to make its intra-day high or low or major move, in a specific continent. This will be the Asian trading time zone, or the New York trading time zone, or the London trading time zone. And for many currency pairs, the tendency is there. Other strategies focus more on day to day movements, and not on time zones. In this case, factors impacting a specific currency pair, tend to be in big control, and determine the major trend. Fundamentals tend to have the upper hand over all other factors, such as technical chart formations, daily news, and day to day volatility. Traders focus on quarter to quarter fundamental analysis and the few economic numbers that matter most. They also know that these economic numbers are very tough to figure out, at least using conventional wisdom. But by taking into account what happened in the previous quarter, and the relation between market price and fundamentals, they can figure out whether the currency pair in question is in a bad or good position.

forex Online Trade
Most traders chase elusive profitable opportunities using fancy, price-based indicators, while ignoring time zones and quarterly fundamental analysis. Two smart questions to ask here are…  Do central banks and policy makers make decisions using such indicators? and… How would these policy makers make buy and sell decisions if they were day-traders?

Forex Online Trade Techniques Day-Traders Use

Day-traders use forex online trade techniques which do involve the time zone factor, as well as forex news and daily stories. Even commodity and stock market news can impact one currency or another, though not always in the same way. Day-traders use quarterly and weekly analysis too, at least the successful ones do. Looking into the intra-day market charts only is a big mistake, because even the intra-day trading action is heavily impacted by longer time frame traders and investors. The central bank intervention for example, is one such factor, which can cause a currency pair to deviate from its expected trend for several days. These interventions cause great confusion to technical traders, since price seems to behave nonsensically. But fundamental analysis focused on quarterly outlook, can reveal whether or not such interventions are needed. Because that’s how h central banks themselves look at national currencies. Generally speaking, regardless how one trades, their analysis should always include quarterly fundamental outlook. Because that is the time frame which carries most weight when politicians and monetary policy makers make decisions. And if the quarterly outlook is for example up, then there will be some strong up weeks in the quarter in question. And this is very important to even day-traders, since an entire trading week becomes possible to trade with great confidence.

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