counter trend

Trading manual part 6 types of trading cont.

Trading manual part 6 types of trading cont.

Trading counter trend wise

Counter trend trading is something we wouldn’t advise to beginning traders. It’s
often a difficult and risky move to trade against the overall trend. However, when you
are more experienced, it’s possible to achieve some decent profits out of it. As you
just learned that a trade needs the space to breathe, you could potentially become
successful in the counter trend way. But, you always need to be aware that the risk is
certainly higher! This is because often highs and lows are presented false on the

You need to be aware of the fact that counter trend trades are often short time. The
overall outcome from a counter trend trade and its retracement is often depending
on the overall timeframe we’re trading from. It is essential to be fully aware of the
aggressiveness of the trade, to predict the impact from the counter trend.
Unfortunately, we see that traders often lose money when trying to execute counter
trend trades. For example, a lot of counter trend traders are looking to buy new lows
in a downtrend, to catch the upward move to a new Lower High. This is just as risky
as selling the new Lower Highs.

Day trading & Scalping

Day trading is defined as the buying and selling of assets within a single trading day.
Basically, a day trader executes around 5-10 trades on a daily basis. However, the
market doesn’t give a selected amount of trading opportunities each day. This makes
it a risky trading style, especially for beginning traders who often develop bad trading
habits with it. Most of the traders get impatient as they want to take a certain
amount of money from the markets each day.

As a day trader, you would probably not let any positions run overnight. This means
that you must be very accurate in placing your take profit and stop loss targets.
Discipline is a key element in trading, however, in day trading it is just a bit more
important. You must be aware that the high liquidity pairs on the Forex market such
as EUR/USD etc. onlyjump around 60-100 pips a day. This means that the movement
from the pair can be quite limited what makes it even more important to monitor the
position closely in order to make any profit. Later in this course (terminology) we will
go more in depth on all different terms as “pips” etc.

Loads of day traders handling a strategy which is a lot different than which was
expected by beginning traders. In real life, we can say that professional traders
usually spend a lot less time with the markets.


Trading advises

As a professional day trader we would advise to not take any more than 1-2 high
profitable trade set up’s on a daily basis. When placed, it is smart to take some time
away from the markets as it’s important to not develop any emotions when you are
in the trades.

Scalping can be perfectly placed in the category of day trading. This is because it
involves trading on the lower timeframes which often exists the 5 Min chart and
lower. Scalping is basically the term used for locking in small profits by going in and
out several trade set-ups on a daily basis. As a scalper you will be behind the charts
more often. You focussing on jumping in and out trades to gain or lose a small
amount of pips. Only experienced scalpers often trade without any stop losses or
take profit target. The scalper who DO use it often have shitty risk to reward ratio’s as
you are mainly controlling the trade manually!

scalpels are basically looking to lock in 5-10 pips a trade, and to do this multiple
times throughout the day. Scalpers often use a high leverage to make decent profits
from the small price fluctuations. This can add up quite fast as you could manage to
do this over and over again throughout the day. However, you are constantly taking a
risk! If you like to be behind the charts throughout the day, then scalping may a great
opportunity for you. However, if you rather analyse and think over every trade you
make to reduce the risk, you won’t suit scalping to well!



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