This is the very important.
With governments and banks moving the market day and night,
our job is to ride the waves of
money flowing in and out of different currencies pairs.
The best way to do this is by trading in line with the
dominant trend.
Faraday
Research
5 ‘Trading with the trend’ sounds very simple, but you will
be amazed how many traders fail to
adequately establish the ‘dominant’ trend before entering a
trade.
Simply put, an uptrend is a series of ‘higher highs’ and
‘higher lows’ and a downtrend is a series
of ‘lower highs’ and ‘lower lows’.
Perfect uptrend:
Perfect downtrend:
The key to successfully identifying the dominant trend in
the market is to use
multiple-
timeframe analysis.
Faraday
Research
6:Multiple-timeframe analysis is the process of viewing the
same currency pair over different time
frames in order to gain ‘perspective’ on the current trend.
The larger your time frame, the greater
your perspective.
Under this strategy, you should only trade when the trend on
the 3-month daily candle chart is
the same as the trend on the 1 year weekly candle chart.
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