Forex Trading Strategy

Loading the player...

DEFINITION of 'Forex Trading Strategy'

A set of analyses that a forex day trader uses to determine whether to buy or sell a currency pair at any given time. Forex trading strategies can be based on technical analysis charting tools or fundamental, news-based events. The day trader's currency trading strategy is usually made up of a multitude of signals, which trigger buy or sell decisions. Forex trading strategies are available for free, for a fee or are developed by the traders themselves.

BREAKING DOWN 'Forex Trading Strategy'

Forex trading strategies can be either manual or automated. A manual system involves a trader sitting at the computer screen, looking for signals and interpreting whether to buy or sell. An automated trading system involves the trader "teaching" the software what signals to look for and how to interpret them. It is thought that automated trading takes out the human element of psychology that is detrimental to a lot of traders.

Both automated and manual day trading strategies are available for purchase over the internet. It is important to note that there is no such thing as the "holy grail" of trading systems. If the system was a perfect money maker, the seller would not want to share it.

RELATED TERMS
  1. Forex Signal System

    A set of analyses that a forex trader uses to determine whether ...
  2. Forex Analysis

    An examination of the changes in the forex market that are used ...
  3. Forex Trading Robot

    A computer program based on a set of forex trading signals that ...
  4. Automatic Execution

    A method of executing trades without inputting them manually. ...
  5. Forex Training

    A form of instruction or mentorship that provides information ...
  6. Real Time Forex Trading

    A form of speculation in which a trader bets on the movement ...
Related Articles
  1. Trading

    How To Become A Successful Part-Time Forex Trader

    Getting started in this potentially profitable market is easier than you might think.
  2. Trading

    10 Ways To Avoid Losing Money In Forex

    When approached as a business, forex trading can be profitable and rewarding. Find out what you need to do to avoid big losses as a beginner.
  3. Trading

    Forex Automation Software For Hands-Free Trading

    Automated forex trading software scans the market for favorable trades based on your input. Find out more about this valuable forex tool.
  4. Trading

    Guide To Smartphone Forex Apps: Forex Education, Signaling And Other Apps

    From discussion forums to how-to articles, educational forex apps can provide traders with an easy-to-access way to learn more when on-the-go. Forex traders can use these resources to learn everything ...
  5. Trading

    Forex Trading: A Beginner's Guide

    Learn about the forex market and some beginner trading strategies to get started.
  6. Trading

    10 Forex Misconceptions

    The currency markets are full of myths that can harm a trader's chances at success.
  7. Trading

    No Forex Strategy Of Your Own? Try Mirror Trading

    There are many advantages to trading a mirror strategy, yet markets are dynamic, and regardless there is always a risk of losses.
  8. Trading

    The Forex Market: Who Trades Currency And Why

    The forex market has a lot of unique attributes that may come as a surprise for new traders.
  9. Trading

    The Pros And Cons Of Automated Trading Systems

    Automated trading systems minimize emotions, allow for faster order entry, lead to greater consistency and resolve pilot-error problems.
  10. ETFs & Mutual Funds

    Trade Forex With A Directional Strategy

    Opening long or short positions to cash in on a trend is one of the simplest ways to trade forex.
RELATED FAQS
  1. What is the best method of analysis for forex trading?

    Types Of Analysis Used In ForexForex analysis is used by the retail forex day trader to determine whether to buy or sell ... Read Answer >>
  2. Is scalping a viable forex trading strategy?

    Scalping in the forex market involves trading currencies based on a set of real-time analysis. The purpose of scalping is ... Read Answer >>
  3. How do I implement a Forex Signal System into a forex trading strategy?

    Learn how traders use different types of forex signal systems such as trend-based or range-based to create or supplement ... Read Answer >>
  4. What types of accounts are available for forex trading?

    There are many different types of forex accounts available to the retail forex trader. Demo accounts are offered by forex ... Read Answer >>
  5. How do I pick the best method for forex system trading?

    Discover how to identify the best type of forex system trading style for you based on your available time, your trading preferences ... Read Answer >>
  6. What are the most common market indicators forex traders follow?

    Learn the most common technical indicators that forex traders and currency market analysts utilize to predict likely market ... Read Answer >>
Hot Definitions
  1. European Union - EU

    A group of European countries that participates in the world economy as one economic unit and operates under one official ...
  2. Sell-Off

    The rapid selling of securities, such as stocks, bonds and commodities. The increase in supply leads to a decline in the ...
  3. Brazil, Russia, India And China - BRIC

    An acronym for the economies of Brazil, Russia, India and China combined. It has been speculated that by 2050 these four ...
  4. Brexit

    The Brexit, an abbreviation of "British exit" that mirrors the term Grexit, refers to the possibility of Britain's withdrawal ...
  5. Underweight

    1. A situation where a portfolio does not hold a sufficient amount of a particular security when compared to the security's ...
  6. Russell 3000 Index

    A market capitalization weighted equity index maintained by the Russell Investment Group that seeks to be a benchmark of ...
Trading Center