Ways To Obtain a Decent Entry For Your Trade
In today forex faq, we have a question from one of our fellow traders asking me about the below question.
Below is the question:
How do you obtain a decent entry. My exits are fine, as is my money management.
From the question above, it seems that you do not have a working strategy on hand. This is because there is no way you can have a good exit without a good entry if you have a reliable strategy on hand.
However I am glad to know that you understand the importance of money management as it is one of the key factor to successful trading. Since you requested to learn more about entry techniques from the question above, I shall share with you a few entry techniques that you can consider using as entering too early or too late may turn a winning trade into a losing one.
Below are some entry techniques you can use
1) Retest of Breakout – This is a techniques where you will wait for the price to produce a valid breakout of a trend line, S&R or candlestick patterns and then wait for it to come back to retest that level which it broke through.
Once it comes back to that level and retest that level, you can enter a trade based on the repulsion of that level. This technique is based on the fact that price tends to retest a level that it breaks through before it continues to move in the direction of the breakout.
2) Confluence of Indicators – Another techniques that you can employ is the confluence of indicators. For any strategy, you will definitely have a few indicators in it.
All you need to do is to wait for all the indicators in the strategy to give you the same entry signal.
For example, you find that the stochastic is overbought, MACD has produced a bearish crossover and it has hit the upper band of the bollinger bands.
All these signals on the indicators tell us that there is a high chance that the price will move down and therefore it is a good entry.
The above are 2 entry methods that you can consider using. However I will suggest that you take up a forex course to learn a working strategy. Alternatively, you can try to formulate your own strategy if you do not want to take any forex course.
If you are interested to formulate your own strategy, you can take a look at this post that I have written sometime back.
I hope that I have answered your question and do feel free to contact me again if you have any other question.