Advanced Forex Trading Techniques

1. Advanced Forex Trading Techniques

2. Index • Forex Trading • Advanced Forex Trading Techniques • Hedging • Position Trading • Forex Options • Scalping

3. Forex Trading • In the beginning forex trading seems like it is simple. • It seems like you only do a job as a trader is to pick what direction the currency pair is going to go and collect the profit. • You are thinking of trying to find the 100 percent accurate forex trading system on the internet. • If only it were that much simple.

4. Advanced Forex Trading Techniques

5. Hedging • Hedging is a way to reduce the risk by taking both the sides of trade at once. • If broker allows it, an easy way to hedge is just to initiate a short and long position on the same pair. • Advanced traders sometimes use the two different pairs to make one hedge, but that can get very difficult.

6. Position Trading • Position Trading is based on your overall exposure to a currency pair. • Your position is the average price for a currency pair. • Example: You might take a short trade on EUR/USD at 1.40. If the pair is ultimately trending lower but happens to retrace up, and you take another short at 1.42 at your average position be 1.41, you will be back in overall profit.

8. Forex Options • A forex option is an agreement to purchase the currency pair at a predetermined price at a defined time. • Example: You are long the EUR/USD at 1.40, and you feel that there is a chance that it falls to 1.38 in overnight trading. • Not requiring to risk a more profound reaction, you decide to put a stop at 1.3750, setting up potential loss of 250 pips.

9. 250 pips sound painful, so you choose to use a forex option to lessen the pain. • You purchase an option for overnight hours with the strike price of 1.3750. • If EUR/USD goes up and never touches 1.3750 overnight, you lose the premium that you paid for the currency option.

10. If the EUR/USD falls and touches your option and stop loss, you would receive profit from your option, depending on how much of a premium you paid, and you realize the loss of long trade on the EUR/USD. • The options profit make up for some of that loss on the currency trade.

12. Scalping • Scalping is making a very short-term trade for a few pips using the high leverage. • Scalping is best done in conjunction with a news release and supportive technique conditions.

13. Many beginning forex traders start with the scalping, but it does not take long to figure out it how much you can lose if you do not have the idea what you are doing. In general, scaling is a risky strategy that doesn't pay well in comparison to its risk. • If you are going to make scalping trades, it is best to do them in conjunction with overall trading position, not as a primary method of trading.

14. Advanced Forex trading is about seeing all the options when you make a trade. • Aside from using the masterful risk management and extreme caution, advanced trading can be an alternate way to make profits and control losses. • Advanced trading techniques are just about using market's behaviour to your advantage.

15. Learning to use advanced techniques correctly is what give you the edge that makes you stand apart from the average trader.

16. Thank You