Forex grid trading
You can make money buying and selling the same currencies at the same time. We are now coming to the heart of how to make money using the no stop, hedged, forex trading strategy. In the previous articles in this series we discussed trading without stops, not being concerned about which way the price goes and places to cash in on profitable trades. One should always be able to cash in at a gain no matter which way the market moves when trading the no stop, hedged grid trading system. This sounds like trading suicide to most traders but let’s take a closer look.
Let’s assume that a forex trader starts trading with a sell (sell 1) and a buy (buy 1) when the price is at a level of say 1.0100. The price then moves to level 1.0200. The buy transaction will then show a gain of 100 pips. The sell will be negative by 100 pips. The sell is now however carrying a loss of -100 pips. To do this one would again enter into a sell (sell 2) and a buy (buy 2) deal at this level (level 1.0200).
The second sell (sell 2) has now gone positive by 100 pips and the second buy (buy 2) is carrying a loss of -100 pips. This makes the total cashed in at this point 200 pips (sell 2 and buy 1). The four Forex trading deals now magically show a gain when added together:- 1st buy (buy 1) cashed in +100, 2nd sell (sell 2) cashed in +100, 1st sell (sell 1) now breaking even and the 2nd buy (buy 2) is -100. The gives a total profit of 100 pips. This formation is the 100% retracement formation where the price moves up to a grid level and then returns back to the starting grid level and results in a nice gain for the forex trader. There are many other market movements that turn this strange “buy and sell at the same time” activity into gains. There will be much more on the no stop, hedged grid trading system in future articles in this directory. Automated forex trading : Clever yet Effective Technology
Why forex trading?
forex investment is unique in various aspects. $500 bn. $750 bill ( Apr 1992 )
$1.18 trillion ( Apr 1995 )
$1.48 trillion ( Apr 1998 )
$1.16 trillion ( Apr 2001 )
From the figures alone, you will notice the average trend of foreign exchange turnover is increasing.
The concept of automation becomes the new trend to the foreign exchange trading market.
There are several benefits that a forex trader can derive from automated Forex trading.
through automated process, transactions can now be done in real time. Though manual systems have existed for quite some time now, it is difficult to achieve such benefit the automated foreign exchange system can offer to its traders.
With automated Forex trading, you will have a greater diversification. It suggests that you can trade in varied markets in different time zones at a time. You can use varying trading models to guage short-term information.
As formerly mentioned, the forex market is unique because of its acute liquidity. This liquidity is increased when the market goes automated.
Risk management issues are solved through automated Forex trading. World checks, which are ordinarily employed in making purchases on forex market, are synchronized thru automated technology. Given the fast yet efficient trades on varying time-zones, automated Forex trading will now be among the present rewarding business around the world.