Forex & Stock Trading Strategies
I wrote this article as a follow-up to the article I wrote on different types of markets where I wrote about the importance of understanding what really drives the market you are trading. A trading strategy must be designed specifically for the forces that are driving the market that you want to trade.
As I said in my previous article, the Forex market tends to be driven by macro-economic fundamentals and the policies of governments and central banks. Stocks and shares tend to be driven by the sentiment of traders and market participants. In the long-term the stock market is like a weighting machine that measures a stocks value, in the short-term however the stock market is more like a voting machine that measures trader's sentiment. Of course, traders sentiment also effects the Forex market, but it usually isn't significant enough to make much difference, except perhaps during times of great financial crisis.
The best trading strategies for trading the Forex market tend to be a tend following or momentum trading strategy. The best strategies for trading stocks and shares however tends to be strategies that make use of support and resistance.
If you're interested in trading the Forex market I would recommend reading my article on the best Forex trading systems. And if you are interested in trading stocks and shares here are some stock trading systems that I hope you will find useful.
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