Forex Trading Strategies to Improve Your Performance

A trader's success also depends on adopting the right forex strategies and using advantageous solutions such as cashback.

Forex trading is an activity that can give you an engaging experience and earnings in line with your ambitions. However, often the desire to get everything and immediately can lead you to make wrong choices, with negative consequences on the balance of your investment.

As in all things, even in trading it is advisable to act according to a pre-established action plan, reserving only some phases of your activity to instinctual decisions.

Adopting a precise forex trading strategy allows you to foresee the possible difficulties and opportunities that will arise along the way, to decide in advance and with due clarity the actions to be taken in the various situations.

How Forex Cashback Works

The best trading strategies, already tested by thousands of investors around the world and adaptable in various contexts, allow you to identify in advance a profit ceiling to be considered satisfactory, or a maximum loss that you can consider acceptable. In this way, you can manage risk wisely and without being overwhelmed by the emotionality of the moment.

In addition, next to the forex strategies that we will talk about briefly in this article, you have the opportunity to make use of some investment solutions that allow you to optimise costs.

For example, the cashback option, offered by some specialised platforms such as STIC Cashback, ensures you a refund commensurate with the volume of your trades.

The Best Forex Trading Strategies: Trend Following

A trading plan is essential to make decisions objectively and thoughtfully. Whatever your trading style, conservative or aggressive, you need a strategy to more easily make a profit from your investments and understand when it's the right time to exit a position.

Obviously, to choose which of the best trading strategies to adopt, it is essential to understand which of these may best suit your style and the operations you intend to carry out.

For example, if you are trading in a market with low fluctuations, suitable for a long-term trading style, a great strategy is trend following. In essence, it is a matter of identifying the trends of a given market and entering while they are in place, to take advantage of their effects.

In a bull market, every buy trade will lead to a profit if the trend actually continues. This way, a short (sell) position in a downside scenario will allow you to seize the right moment to get rid of your assets, before they suffer excessive devaluation.

The technical analysis of a market, of course, can go even further, allowing the adoption of more refined forex strategies. An indicator such as the Moving Average, for example, offers an overview of a given trend over a rather long period, allowing an even more accurate reading of the data – and, therefore, a calculation of the forecasts.

More specifically, a strategy that follows the ADX (Average Directional Index) allows us to understand the strength of a trend, comparing the directional movements of a market, in order to identify the best entry point to sell or buy a security.

How to Choose the Right Time to Exit the Market: Resistance and Support Levels

Similarly, the analysis of a trend makes it possible to identify maximum levels (so-called resistance levels) and minimum levels (so-called support levels) touched by the value of an asset over a certain period of time. At a resistance level, therefore, the trader has the opportunity to schedule a sale, using the Take Profit option (offered by all major online brokers) and monetising at a price that will hardly be exceeded.

In this way, a predetermined gain is ensured when the resistance level is reached, and at the same time an automated market monitoring function is used, without the need to follow the price trend in front of the screen minute by minute.

Similarly, the use of the Stop Loss option allows you to order the automatic sale of a security at a support level, avoiding the risk of a possible breakout of the price below the support level.

Forex Strategies and STIC Cashback: The Success Formula for Traders

For an intermediate trader, as we mentioned above, strategies are only one part of the formula that can lead to success. Tools such as cashback, in fact, help to optimise costs, allowing you to recover part of the amounts invested with certainty.

STIC Cashback, for example, allows you to increase the number of operations to be carried out, since you can count on a partial return on investment based on your trading volume.

In this way, you can operate with greater confidence even in more volatile scenarios (lateralised markets) or allow yourself to bet on breakout positions even within the framework of a conservative strategy, such as the one that follows the trends of the moment.

The combination of learning the most effective forex trading strategies and using tools such as cashback for trading will allow you to reduce costs and more effectively pursue immediate gain in the markets.

Find out today how cashback can make a difference in your net profits!