Forex Day Trading Strategy

Forex Bank Trading Strategy Explained (Updated 2018) • Who is Smart Money? • What is the Forex Bank Trading Strategy?

Day trading strategies are usually the perfect forex trading strategies for beginners. Trades may last only a few hours, and price bars on charts might typically be set to one or two minutes. The 50-pips a day forex strategy is a good example of a day trading strategy.

/forex-vtb-24-reviews.html. Signing up for online tutorials or in-person conferences will help you lay a base layer of knowledge on the forex market, but traders agree that true expertise is built on the job. Jump in to a demo or a real (small sum) account and start hitting buttons, pulling from vast online resources whenever you hit a snag or just a big, fat question mark. Is forex worth it?

• Why is Tracking ‘Smart Money’ Critical to Successful Trading • Step 1: Accumulation • Step 2: Manipulation • Step 3: Distribution/Market Trend Who is ‘Smart Money?’ Throughout this article, you will read the term ‘smart money. ’ I use this term to define the largest market participants; those who move massive volume so large that their position cannot be opened and closed in a single order without spiking the market. This includes the largest banks, prop firms, massive global companies, insurance companies, Hedge Funds, as well as speculative traders in every variety from around the globe. It is important to understand that although the banks might control the majority of the daily volume, the VAST majority of that volume is those banks acting as a market maker for the other types of traders mentioned above. Yes, banks do take speculative positions, but the vast majority of the volume they transact on a daily basis is for the purpose of market making, not speculation.

This is critical information, as it tells us 1 very important clue. If banks are primarily market makers then they will by default drive the market to and from areas of supply and demand which is the foundation in how we track them. What is the Forex Bank Trading Strategy?

Definition: The Forex Bank Trading Strategy is a trading setup designed to identify where large market participants are likely to enter or exit their position based on likely areas of supply and demand, or manipulation points as we term them. As you can see in the chart above, the top 10 banks control well over 60% of the daily forex market volume. What if you could determine where they were likely buying or selling?

Do you think this information would be profitable? Tracking smart money is at the very foundation of the bank day trading strategy. If we can consistently reveal where the smart money is entering, and the direction they are trading, then we have all the information we need to make a profitable trading decision. We must remember that this is the banks market, and not ours! Retail traders are figurative flies on the wall. Keeping that in mind, why then do most retail forex traders out there attempt to invent or learn forex trading strategies that have been created to try and fit a market we do not control?

It is our strong conviction at Day Trading Forex Live that success in the forex market is only possible when we stop trying to fit different rules to a market we don’t control, but rather learn the trading strategy of the banks! This is their business, and they have a business model (aka forex trading strategy) that we must learn to follow to achieve consistent results! We do this through the repeatable 3 step process described below. /best-binary-options-site.html. If we learn to trade forex by following their model we will have a much greater chance of success; after all the banks are the ones moving the market! 3 Steps To Success In any market, there must be a counterparty to every transaction. If you are looking to buy the market someone must be willing to sell to you. Conversely, if you are looking to sell then someone needs to be willing to buy your current position from you.

Knowing that, how can we use this information to track where the smart money is likely to be buying or selling? If Bank XYZ desires to buy a large position in the EUR/USD, using the principal discussed above they must find an equal amount of selling pressure. As their positions are so large, they are always entered over time so as to not reveal their hand. This leads us to the first step in the process, accumulation of a position. Step #1 – Accumulation: As discussed above there is a counterparty to every transaction in any market including the forex market. Therefore when a bank or group of banks has the desire to enter a position they must do so by accumulating it over time.

Unlike you and I, because of the sheer volume banks push they must enter positions during times most people would term as consolidation or range bound markets. These periods of consolidation are what we call accumulation as they are areas where smart money enters or ‘accumulates’ their desired position over time. By doing this through a tight range bound period, banks are able to not only keep what they are accumulating secret to the rest of the market, but they are also able to get a much better average entry. This is the foundation of how the banks enter positions over time.