Step #2: We’re going to use , the best forex in a smart way. In an uptrend, we buy after the best forex has reached oversold conditions (below -80). And then rallied back above the -50 level.
Note* If the %R continually stays in oversold territory (below -80 level), it signals a strong momentum and conversely a strong trend. Inversely the same is true in a uptrend.
Step #3: Place Your Protective Stop Loss below the Recent Higher Low.
We want to hide our protective stop loss. It is below the most recent higher low level that formed right before the best momentum trading strategy issue the buy signal.
Alternatively, you can also trail your stop loss below each most recent higher low. This strategy will allow you to lock-in the potential profits in case of a sudden market reversal.
Step #4: Take Profit once we break below the Previous Higher Low
A trend in motion can stay in that state longer than anyone can anticipate. And since we want to maximize our potential profits we let the market tips it hands before liquidating our trades. In this regard, we look for a break in the trend structure. Respectively a break below the most recent higher low.
Alternatively, you can take profit once the best forex breaks below the -50 level.
Note** The above was an example of a BUY trade using the Best Momentum Trading Strategy. Use the same rules for a SELL trade.
The best momentum trading strategy (%R) leverages the tendency of a market’s price to continue moving in a single direction. This is where the momentum might be upwards or downwards. In essence, market timing is crucial for a strategy. And in this regard, we incorporated the best Forex ( ) in our momentum strategy. Here are some of the trading conditions you want to avoid in the forex market.
Timing the market can be a daunting task. But our team at Trading Strategy Guides believes that using a pure price action can get you a long way. Check out our Price Action Trading Strategy.