Forex Explained
Forex Explained
Forex Spread Betting Explained - What is a Good Forex Spread Betting Strategy?
Forex Spread Betting Explained
Many people are fooled between a spread betting strategy and a trading strategy. Although there is plenty of information available on the internet on Forex trading strategy seldom mention advice on how to manipulate your spread betting strategy to maximise profit and limit losses, this article is about a good Forex spread betting strategy.
It is very well to have yourself a profit target and a stop loss set at the maximum you are willing to lose but what happens when you are triggered into a trade and the profit target is not quite reached? Do you allow the trade to simply reverse and go against you the amount you have your stop loss set for, or do you manipulate your spread betting strategy.
I have a theory for you to think about and one that has worked for me for many years; Lets' just say for arguments sake that you trade at ten pounds a pip and you day trade for quick profits, a good Forex spread betting strategy is to enter a trade with the assumption that you are going to make a ten pip profit, this doesn't sound like much to start with but the best is yet to come. Forex Spread Betting Explained
When you reach your ten pip profit, which is normally very quick especially when trading of new highs' and lows', you take out 80% of your trade; at this point you would have banked £80. It is the decision that you make now that will see a good spread betting strategy.
Move your stop loss up to your trade entry point or to the last support or resistance level which ever looks safest, if the stop loss is at your entry level you now have a trade running at £2 a pip with no risk. If the trade reverses against you then you still have made the original £80, if the trade keeps running then it could run into 100's of pips. Keep adjusting your stop loss to lock in profits but leave sufficient room for the trade to breathe; don't forget this is now risk free! Forex Spread Betting Explained
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Forex Trading Explained
