There are four areas to enhance foreign exchange entry techniques, namely analysis, position, low-risk entry and scale-up.。These are not specific techniques, but rather principles that must be followed when creating a personal forex trading strategy。

All good traders will use these 4 important forex entry principles and we strongly recommend that you study them and develop a plan to incorporate into your own trading。

1.Analyzing the foreign exchange market

Technical analysis dominates when constructing forex trading strategies, but fundamental analysis can be used to identify the dominant themes or trends in the market。Support and resistance levels, trend lines and candle charts can all be used to determine your entry point。Every time you view the chart, you should consider common support and resistance levels and apply trend lines to determine the strengths and weaknesses of the market。

Globally, it is important to consider the economic outlook and key data for different countries, such as whether the country has lowered or raised the Reserve Bank rate, the difficulty of borrowing funds for each country, and the implications of employment data at the time, which are extremely important for determining the larger trends in the market.。

2.Position size in the foreign exchange market

Position size is crucial for your forex trading and will make your account either prosperous or down。Before trading based on Forex entry signals, you must adjust the size of your position to control losses, regardless of the accuracy of your analysis。

If you have established too large a position in a trade, you may suffer great losses due to strong movements that are unfavorable to your position。When your trading amount is relatively large, it is always difficult to avoid position losses。Stop losses in time to go further and still have available funds when the best opportunities arise。

3.Low risk entry - sell strong and buy weak

Low-risk entry points can improve your chances of success in Forex trading。A low-risk foreign exchange entry point means that if the transaction does not proceed as planned, your losses will be very small, and by keeping the losses at a small level, you can improve your risk-return ratio and overall profitability。Low-risk Forex entry points not only make trading easier, but also more profitable overall, because when a trade fails, your losses are very small。

The trading principle is to buy weak and sell strong.。Usually, when the market extends in one direction, such as oversold, you can measure the long entry price through a strict stop loss, which is usually the maximum return for risk opportunities at these times。You have to be flexible to trade around these points, and when they appear, there is an opportunity to scale up as the trade moves in a favorable direction。

4.Scale Up - How to Increase Winning Positions

You can try to trade by establishing part of the position, and if the trade moves as expected, you can increase the position, which is called a drawdown。While most forex traders open positions in bulk and exit in the same way, you can also increase your profit position to maximize your trading returns。Shrinking is one of the most commonly used Forex entry techniques。

Developing position size models is like finding good entry techniques。An example of scaling up is buying at a fake breakout support level, and then adding to the original fake breakout position when the market rebounds above the support level and continues to rise to the resistance level。

Conclusion

Make sure you adhere to these principles when developing your forex entry strategy, which will greatly provide you with a solid platform for trading success。