Don’t feel in despair when you find yourself still not being successful in Forex trading despite you’ve tried out so many currency trading systems, although you’ve given it a shot with the sophisticated ones. Before we get back into trading systems, first of all, you should always remember that trading is an art rather than a science. Perhaps, you’ve bought some currency trading systems from any online trading gurus but you still can’t manage your fund in the Forex market. Why such things happen? Simplicity could be the answer.
Many novice traders, or even some experienced ones, get drifted to some sophisticated currency trading systems. Some traders want to look like a smart trader by applying those tricky techniques. But they forget that the essence of trading is consistent profit. No matter the currency trading systems are sophisticated or simple; the utmost importance is consistent profitable trade. However, as trading in Forex market or any other financial market is an art so it will be better for you if you keep a simple trading system.
One of simple currency trading systems which used by a fund manager in a famous bank is utilizing Moving Averages. As we know that Moving Averages is a trend following indicator. You should know that when a currency moves in trending then it will give big money for any traders who can catch the momentum.
This currency trading system uses 100-period Simple Moving Average. Simply put the Moving Average on daily, hourly and 5 minutes chart. They all have their own purposes. 100-day Simple Moving Average on daily chart is utilized to spot the medium term trend of the market and acts a support or resistance; depends on its relative position to the price, while other Moving Averages on hourly and 5 minutes charts are used for timing precision and as support or resistance as well.
When you see the price of a currency is above 100-period Simple Moving Average on both hourly and 5 minutes charts, you’ll likely to see a good upwards movement, usually it will give you 50 pips. On the contrary, when price is below Moving Averages on both time frames, the chance is price will move lower. When price is above 100-period Simple Moving Average on hourly chart and at the same time it is below 100-period Simple Moving Average on 5 minutes chart, you’ll possibly lay hands on smaller opportunity but still worth to try.
It’s a simple and profitable currency trading system, but when you can explore and follow it with strong self-discipline; you’ll no longer feel in despair with your trading.