Forex Strategy Trading with the trend


Forex Strategy for Beginners 1: Trading with the trend
Forex strategy: Trend trend Follow-up strategies are not for nothing the classic among trading strategies and also for beginners well suited. Trading often makes sense to choose the path of least resistance. For example, if there is a stable upward trend in a forex currency pair, the likelihood of a trend continuation is higher than for trend reversal.

How do I find out that there is a trend?

Before developing a strategy for forex, it makes sense to deal with basic principles of trend recognition. These are the prerequisites for a successful trading strategy. In principle, an upward trend is characterized by higher high points and higher low points. If the low points are connected to a straight line, a so-called trend line or in this case a upward trendline is obtained. In the downward trend, it is the other way around: deeper low points and lower between highs mark the downward trend.

In addition to trend lines, indicators such as moving averages can also be used for trend analysis. As a general rule, if the moving average increases, there is an upward trend. The combination of two moving averages with different time horizons is also useful. If the averages are almost parallel and rise or fall, there is a stable trend in the short and medium term.


Forex Trade Signal 2: Support and Resistance


Very simple but often effective is the focus on important supports and resistors in the chart, which can be used for a favorable entry. The introduction of support and resistance is often the advantage that the risk is clearly defined in the form of the stop. Because of their simplicity, support and resistance do not require a complex explanation of forex indicators, but this can be completely dispensed with.

Forex trading Signals: Support and resistance
The chart above shows the support and resistance areas in GBP/USD. For example, the third Test of the support zone in the range of 1.5250 – 1.5330 offered a forex trading signal for a long entry. The stop is clearly defined and is placed slightly below the lowest low point. The opposite situation is due to the resistance of 1.6300. A short entry with low risk can be made here.

The trade signal support and resistance is one of the most effective trade signals and is also known from English with support and resistance. By setting stops, this trade signal is recommended especially for forex traders and forex trader, who like to be safe on number.

Forex Trading signal 3: Oscillators

Forex Trading Signals: Oscillators
While moving averages deliver very good forex signals with pronounced trends, oscillators can act as good forex indicators in sideways phases. The most famous oscillators are RSI (relative Strength index) and stochastics. These indicators are part of the standard program of any good forex trading platform. RSI and Stochastics Mark Overbought and oversold areas. A RSI below 30 provides a purchase signal, above 70 is a sales signal. In the GBP/USD chart below, the purchase and sales signals in the area of support and resistance zones are clearly identifiable.

The important thing to note about oscillators is that they work very well as forex trading signals in sideways phases, but the oscillator values can remain very long in the overbought or over-sold area in marked trends. Oscillators then deliver false signals and should be ignored.
Like the support and resistance trade signal, the trading signal oscillators also belong to the frequently used trading signals. The oscillators are also better known as relative strength and stochastics. Your history gives you signals for buying or selling.

Acting systematically: linking trade signals to a strategy

Theme icon WissenMarket scanners support the assessment of the current market situation and are good decision-makers in the choice of a sensible trade signal. To be able to select the right trade signal, it is advisable to look at the functioning of the market scanners and the scanned markets from time to time and not simply accept the results data.

In addition, when a trade signal is coupled to a forex strategy, it is also possible to determine a purchase or sales decision when reaching certain top or bottom limits. Let’s refer to the Stop loss order. When linking trade signals with a strategy, one can also speak of a trading system.

In trading systems, it is important to pay attention to the trading strategy underlying the trading systems. Not only the trading strategies vary according to the online forex broker, but also the calculations of the respective reference quantities and their parameters for weighting. Here we refer to oscillators and trend.

Forex trading Signals: The most important concepts


Forex trading is now open to everyone and many private traders start trading in the forex market. The market is extremely liquid and can be traded around the clock, so there are countless trading opportunities every day.
It is all the more important to focus on a few effective strategies to act successfully. Successful trading strategies generally take into account the areas of entry, exit and risk management. We present some Forex signals with example, which can be used for entering a trade.


The most popular forex trading signals and strategies at a glance:

The trading signal moving average crossover
Support and resistance, also known as outbreak strategy
Oscillators as a trade signal
1-2-3 Formation Strategy
Break-out and range strategy
Forex Trading Signal 1: Moving average crossover

Forex trading Signals: Moving average crossover
Forex trading Signals: Moving average crossover
Moving averages (MA) are a classic among the indicators used for trend analysis. Combining two moving averages with short and longer time horizons, these moving averages can provide forex signals – always when the faster (shorter period) of the two Mas crosses the slower MA (ideal typical example of forex trading signal).

The EUR/USD chart shows a 7-day average (red) and a 17-day average (blue). If the ma7 crosses the ma17 from above, this offers a forex trading signal for a short entry (trading on falling prices in the EUR/USD), at crossing from below for a long entry to rising prices. It is also clear that moving averages work best when there are clear upward or downward trends. In sideways phases they tend to produce more false signals.

How does the forex lever work?

This is how the forex lever works!
One of the most attractive characteristics of FX trading is the use of large financial levers, which also enable large profits in the case of manageable operations and in a very short time. The forex leverage, however, carries significant risks that should be understood before the commencement of trading. In the following we would like to explain the forex lever on an example.

Due to the leverage effect, forex trading holds high yield opportunities with low capital usage – at the same time also the risk of a total loss.
In forex trading you can profit from rising and falling prices.
Currencies are always traded in pairs.
In order to act with leverage, a margin must be provided.
In the case of insufficient capital coverage, a margin call is required.
Analysis tools are designed to help you better assess forex price developments and derive trading strategies from them.
Scheme of a currency transaction: That’s how it works!

In theory, a currency transaction can be reduced to two transactions: an investor borrows money in one currency and puts it in the other currency immediately thereafter. In a perfect market (only theoretically existent), the credit and investment interest rates are identical. If the loan is due, the investor will withdraw the money from his investment account, exchange it in the credit currency and wipes the loan. If a depreciation of the credit currency has occurred in the meantime, the investor gains a profit: He does not have to use the entire balance of the investment account to repay the loan. If an appreciation of the credit currency has taken place in the meantime, the investor suffers a loss: the balance on the investment account is not sufficient to completely pay off the loan.

So works the forex lever
So works the forex lever
In principle, foreign exchange is a foreign currency. For example, you may be credited in a bank account or securities that record a foreign currency.

Currencies are traded in the foreign exchange markets, where currencies are always traded in pairs. Rather, one currency is exchanged for another currency. The Forex trading platform is one of the most important trading venues and is one of the largest financial markets in the world. This is not a centralized exchange, but rather an electronic network of banks, central banks, companies, governments and also private individuals. These mark participants act directly with each other.

Direct to the forex Test winner GKFX

In order to earn money from a currency transaction, investors rely on price changes of one or the other currency and thus on the change in the exchange rate of the traded currency pair. The most traded currency pairs are:

Investors can rely on both rising (long) and falling (short) price developments in foreign exchange trading. The trader gains profits if, for example, he assumes that in the USD/JPY currency pair the US dollar rate rises against the Japanese yen – it is long – and the corresponding event also arrives. In order to be able to act on the Foreign Exchange (Forex), an account must be opened with a broker specializing in forex. If you do not have any experience in forex trading, it is essential to obtain essential information and try it out with the help of a forex demo account.

As forex trading can always be leveraged to move high trading volumes with a small amount of capital, it is important to know how it works and what opportunities and risks are attached to it. The following section tells you more about it.

Forex Lever briefly explained at an example

For example, if the investor borrows $100,000 and puts it in euros, it corresponds to a EUR-long position in the volume of a lot. In practice, no bank or broker in the world will allow such a business without requiring collateral. The amount of the so-called margin varies from provider to provider. If the broker requires a margin of one percent, the investor must deposit 1,000 euros at a position size of 1 lot. In this amount, credits are blocked as margin on the forex account. The leverage effect is the result of the fact that only a fraction of the volume moving in the market must actually be raised from equity. The forex lever is the reciprocal (reciprocal) of the margin. A margin of one percent corresponds exactly to a lever of 100. How to trade the EUR/USD currency pair with Forex is to be read in our guide.

How does forex arbitrage work?

Forex arbitrage: What’s behind it? 
Forex ArbitrageIm Arbitrage Trading (not only on the FX market) is trying to achieve a risk-free profit by taking advantage of minimal, short-term price inefficiencies. Such market participants, also referred to as arbitrageurs, contribute to the efficient pricing of the markets. The necessary condition for arbitrage trading is the ability to quickly place multiple orders in a market without a broker spread. For this reason, private investors can implement forex arbitrage practically exclusively with ECN brokers, which allow the placement of orders directly into the order book.


This content is examined in more detail below:


1. Arbitrage at a Glance
2. Forex Arbitrage Example
3. Other Forex trading strategies


1. Arbitrage at a Glance


Arbitrage exploits short-lived price inefficiencies for risk-free profits.
The prerequisite for arbitrage is to quickly place several orders directly into the order book.
For arbitrage and scalping are best ECN brokers.
The respective trading strategy should match the trading behaviour and the trading level of the trader.
Basically, no trade without a strategy!
Fibonacci retracements are recurring key figures used to determine course and correction goals.
Scalping and break out is particularly suitable for investors who want to trade in the short term.
2. Forex arbitrage explained with the help of an example


For a hypothetical forex arbitrage example, which is exaggerated in terms of price differences for reasons of clarity, the following three exchange rates were accepted: EUR/USD 1.20 – EUR/GBP 0.70 – GBP/USD 1.65.


A trader opens a position in the EUR/USD to 1.20: He buys 120,000 USD for 100,000 EUR. At the same time, he exchanged $120,000 for the course in 72,727 GBP. This can also be exchanged at the same time at a rate of 1.4286 euros per pound (the reverse listing of EUR/GBP 0.70) in euros. From this he receives 103,898 euros – and has thus earned a profit of 3898 euros.


As already indicated, arbitrage gains are unrealistic in these orders of magnitude. Per lot (100,000 units of the base currency) are often made only a few $ profit. However, since no positions are held over, no financing costs are incurred. By their influence on supply and demand, arbitrageurss themselves eliminate the inefficiencies in their sphere of activity (for example, the market place of an ECN broker). In practice, Forex arbitrage is only possible through software.


Only those who look closely and follow the curves attentively have the right strategy
Only those who look closely and follow the curves attentively have the right strategy
With the trade strategy arbitrage, the so-called Arbitrageur uses spatial and temporal price differences between different exchange rates in different foreign exchange markets for profits. Only through an ECN broker is forex arbitrage possible, as this allows a direct placing in the order Book of the Stock exchange. In short: Forex arbitrage is the profit from the price difference between two or more markets.


3. Further forex trading strategies for Successful trades


Trading strategies to trade with Forex, there are some. The important thing is that the trader finds out which strategy best suits him. Forex beginners should take care to choose a more straightforward and easy-to-understand forex strategy. It is also important to pay attention to well-thought-out and balanced money and risk management. On our rate donor pages forex-Handelsignale, forex-trend strategy and Forex-contra-trend-strategy we present popular and also for beginners suitable trading strategies in detail. In this guide, we want to take the completeness of the strategy for the successful forex trading.
Fibonacci Trading


The so-called Fibonacci retracements are recurring patterns, which are also recognizable in the price movements of the financial markets. The so-called Fibonacci number series dates back to the 12th century and was discovered by the Italian mathematician Leonardo da Pisa. The Fibonacci number series is a sequence of numbers to be continued to the infinite. Each number is calculated from the sum of the two preceding numbers: 0, 1, 1, 2, 3, 5, 8, 13, 21, 34, 55, 89, 144…


If you put two adjacent numbers in proportion and divide them, you get a result of 0.618. If you want to calculate the ratio of two other numbers, there are also important key figures for Fibonacci trading. In general, these figures are also referred to as the “golden section”, so that these numbers can be found in other parts of life. In forex trading these are

What is a forex pip?



Pip and lot are among the most important FX-specific technical terms. Pips are a unit of measure for price changes, with the number of lots the position size is determined. Understanding both terms is essential for anyone who wants to deal with active trading on the FX market in some way. Below is a forex PIP statement focused on the essentials as well as a forex lot explanation with practical example. We’ve also put together a couple of tips to help Forex beginners get started in trading. We also show the advantages of a forex test account.

A PIP is the last decimal point of the course value and indicates the price change.
The number of lots determines the position size (1 lot = 100,000 units).
Forex beginners should first try the forex trading with a test account.
Only two to five percent of the available trading capital should be traded.
For beginners, the main currency pairs are best suited for action.
Trade should always be preceded by trade strategy considerations.


Forex pip definition

Most currency pairs are recorded with four decimal places. A PIP then corresponds to a change of one unit on the last decimal point. For example, if the EUR/USD exchange rate rises from 1.3040 to 1.3050, this corresponds to an increase of 10 pips in favour of the euro in dollars. In addition to price changes, various other facts are measured in pips, FX brokers give their spreads in pips and the (absolute) performance of trading systems is measured in pips. In addition, gains and losses are also indicated in pips.

Forex Pip lot_1

Currency pairs at a glance, always up-to-date and fast actionable
Explanation and definition of PIP and LotDer value of a pips depends on the position size. This is usually measured and agreed in lots. A lot is equivalent to 100,000 units of the base currency. Some forex brokers offer mini-lots with 10,000 and micro-lots with 1,000 units. If a currency pair is quoted in the form EUR/USD, the euro is the base currency, the USD is the exchange rate currency. The appreciation of the EUR in this listing means that more units will be paid USD for a EUR. Newcomers are sometimes insecure when reporting a “rising euro” in financial media, and a downward-facing chart is shown. Many media write down the price in the form USD/EUR (the reciprocal of EUR/USD). If the EUR is to be revalued, fewer units of EUR must be paid for a USD, which explains the falling chart.
Exchange rate movements in forex trading are measured in pips, with a PIP being the fourth decimal point. However, in the USD/JPY currency pair, the second decimal is already counted as a pip, as Japanese yen is only indicated with two decimal places. A lot is the specification of the position size. A lot corresponds to 100,000 currency units, for example 100,000 euro.

Forex market Trading Hours Facts for investors

Forex market Trading Hours: Facts for investors

Core Forex trading does not take place on a centralized exchange.
All market participants act globally and directly with each other.
Trading on the stock exchange is possible almost around the clock.
Course gaps – so-called opening gaps – do not appear as well in forex trading.
The so-called overnight trading can result in both a positive and a negative rollover.
At Forex daytrading with daytrading Software or in seconds trading, minimal price fluctuations can lead to short-term profits.
In principle, FX trading could also be continued over the weekend without interruption. With regard to private traders, this is particularly evident in ECN brokers: They could also run their platforms on weekends and allow traders to place orders that could be served by other traders. What would theoretically be possible, however, cannot be achieved at present, because at weekends the market is simply not frequent enough.

Forex Trading Hours
Overview of Forex Trading hours
In practice, however, liquidity is too low on the weekend, even on the FX market, which is why trading on weekends will hardly take place in the foreseeable future. The reason for this is obvious: on Saturdays and Sundays, institutional market participants do not act, which eliminates a significant part of the market volume. Forex Retail brokers cannot offer their customers trading on weekends because their own liquidity brokers do not provide courses (STP broker) or because they are unable to reliably secure net positions (market maker). The liquidity of ECN brokers would not normally be sufficient.

Nevertheless, Forex trading times have an enormous advantage over stock trading – and since trading in foreign exchange on the market is possible in principle from Sunday night to Friday evening, only small trading hours are lost. Already Sunday 22:00 CET opens the market in Australia, while Fridays is around 11pm. It becomes interesting when opening times overlap, because here are particularly many market participants active. In Germany, especially in the afternoon from 1pm, good chances are calculated, as both trade in the US market and trade in European countries is possible.

The fact that opening hours play a much lower role in forex market than in exchange trading brings many advantages. First, during the week there will be no opening gaps, which can be undertaken by risk management. Secondly, there are distortions in the price development that arise solely from the reaction of market participants to the impending end of a trading day (especially in front of important news!).

While large fluctuations occur in the stock market, especially after the opening and shortly before the closing of the market, trade in foreign currencies remains largely unaffected. In the stock market, it is necessary to keep an eye on the positions in these times. It is recommended to buy or close first positions when the initial fluctuations have calmed down to avoid major losses.

The fluctuations are largely due to news and unforeseeable actions of market participants, often as mentioned just before the closing of the market. Some traders may have made a negative deal and tried to compensate for the loss shortly before the end of an increased risk. Others are putting the day’s profit on the whole, in order to strike out again as much as possible. Messages that arrive late in the evening or at night bring participants to action. For example, you want to take advantage of announced price fluctuations. These actions have a huge impact on the market and, of course, have a certain risk as they are difficult to assess.

In the forex, however, these daily fluctuations are more or less due to the fact that the trade is consistently possible. Thus, this also means a reduced risk of suffering losses due to the unpredictable price fluctuations. Of course, no one can predict exactly how the market will develop without speculating. This means that no direct recommendation can be given on the forex when positions should be closed. Rather, the activity here is based on the current price trend. To take full advantage of trading around the clock, all time zones should be kept in mind. Find out in advance what time you can trade with which currency.

Due to the time shift and the direct trading of market participants among themselves, currencies could basically be traded around the clock seven days a week. However, as market participants are also

What are the benefits of forex trading for traders?


Forex trading is becoming more and more popular and many private traders now prefer the forex trading to the classic stock trading or trading in derivatives such as warrants or certificates. So why should I gain experience as a trader Forex? The main benefits of forex at a glance.


Due to its size, the forex market is an extremely liquid market, on which 24 hours a day can be traded throughout. Thus, the risk for the occurrence of larger price gaps, so-called gaps, is also much lower than in the equity markets.

Due to the high leverage, the first forex experience can be gained with low capital stakes. This enables a large number of private traders to be more active in trading than in the stock market or on the futures markets, which are only accessible with substantially higher capital requirements. Most forex brokers only require a maximum margin of 3% of the traded volume.


Almost all large currency pairs are characterized by a pronounced volatility, particularly in the course of the publication of economic data, interest rate decisions of central banks or other “breaking news”. This is why Forex trading is essential to keep an eye on the news situation.

Depending on the trading style, you should be aware before opening a position that significant messages can cause large movements in the currency pairs. However, high volatility is also exactly the property that short-term traders value and need in the Forex market to benefit from large movements in brief periods of time.

Even without an agitated news situation, majors tend to move in marked trends. This provides excellent conditions for profitable trading in almost every trading style. Daily spans of up to 200 pips in EUR/USD are no rarity and with one reason for the ongoing forex boom.

Direct to the forex Test winner GKFX



The fact that the market operates independently of a central trading place or a stock exchange makes it possible to trade 24 hours around the globe. However, it should be noted that, especially outside of European and American business hours, there is a lower volume of trade in the majors, which can result in negative effects on the quality of the order execution. The so-called slippage, i.e. the difference between the placement of the order and the actual course of execution, may be higher at these trading times. In particular, caution is required for placing market orders without a price limit.

Nevertheless, Forex trading offers traders who pursue a job during the day or prefer to devote themselves to other activities, even if the European stock markets are already closed. Thus, the forex market offers freedoms like no other financial market.

However, the flexibility in forex trading does not only refer to the selection of trading hours, but also to the forex trading itself. Thus, regardless of the size of the account or the broker, it is possible to earn both rising and falling prices. This is not self-evident and usually only possible in the stock market with special trading accounts, which are not always easy to access for trading beginners.

If you go around in the EUR/USD long currency pair, you speculate on rising euro rates in relation to the US dollar. Conversely, a euro-short position would be given if one were to put down euro rates. It is clear that, due to the fact that a currency pair is always traded, a long position in the base currency automatically corresponds to a short position in the counterpart currency.


In contrast to the trading of secondary values in the stock market, which often have only a small volume of trade – which can have a negative effect on a fair pricing – there are virtually no limits to the order size for private traders in the forex market.

The market is extremely liquid in all major trading pairs, whereby the order size can be adjusted arbitrarily to the desired order volume and the account size of the trader. The market is therefore highly interesting for trading beginners with a small trading account, as well as for professional market participants with millions of sales, and provides excellent scalability for effective risk management through its low-cost scale.

What are the costs of forex trading?


The costs in forex trading depend very much on the respective broker. In general, order fees (Commission), spreads, and financing costs are significantly different and should be compared as part of the brokerage option.


Order fees usually only apply to ECN brokers and not to market makers.
Spreads, margin and financing costs should also be considered when choosing the broker.
Transparency in terms of costs, regulation and deposit guarantee is a good broker.
Comprehensive information and continuous training should always be included in the trading strategy.
A free demo account allows you to test strategies, tools and trading platforms.
Through the use of risk management tools, losses can be limited and even price gains maintained.
Only capital should be used for trading, which can be dispensed with in the event of a loss.
Often no order fee for market makers

In the case of so-called market makers, i.e. brokers who provide the customers with direct trading courses themselves, there is often no order fee. This is especially attractive for beginners with small trading accounts. Market makers do not forward the customer orders or only partially to the interbank markets but also match the customer orders internally. This way, no order fees are charged for the customers. The overwhelming number of forex brokers now works according to the market maker model and deserves only the most fixed spread.


Important currency pairs in the overview


Important currency pairs in the overview

Name Currency pair
EUR/USD euro/US Dollar
GBP/USD British pound/US dollar
AUD/USD Australian dollar/US dollar
USD/JPY US dollar/Japanese yen
USD/CHF US-dollar/Swiss franc
USD/CAD US dollar/Canadian dollar
NZD/USD New Zealand dollar/US dollar


The overview of currency pairs shows that the US dollar remains the world’s leading currency. The most important currency pairs (also called majors) are traded against the dollar as a base or counter currency. In forex trading, it should be noted that some of the majors tend to be in the same direction, such as the pairs EUR/USD and GBP/USD as well as AUD/USD and NZD/USD.


EUR, in €
JPY, in yen
GBP, in Pounds
USD, in $
CAD, in Canadian $
CHF, in Swiss francs F
AUD, in Australian $
When trading Forex currency pairs, major and minor currency pairs are differentiated. Minor currency pairs are better known as exotics. In forex trading, major pairs and minor pairs or cross variants can be traded.

Exotic currency Pairs

The “exotics” among the currency pairs are usually not traded against the leading currency US dollars. In addition to the dollar, the euro and Japanese yen are the most important currencies in the foreign exchange market, as they are often held as currency reserves by different nations. Therefore, several euro-and yen-pairs are traded with high sales, including EUR/GBP, EUR/JPY, GBP/JPY or EUR/CHF. In contrast, exotic currency combinations may be more difficult or risky due to the much lower liquidity. These include the pairs GBP/CHF, CAD/CHF or AUD/NZD.

The observation of the exotics can however be useful to gain from analyzing the relative strength insights for the trading of the majors. For example, if you want to buy AUD/USD or NZD/USD, you may find it worthwhile to look at AUD/NZD’s chart. Should AUD/NZD just break out of a sideways movement as the Australian dollar falls in comparison to the New Zealand dollar, then NZD/USD is the better buy due to relative strength compared to AUD/USD.

Source:, AUD/NZD, 2014.12.16 09:48 UTC, Alpari UK Ltd., with the MetaTrader 4, real
Source:, AUD/NZD, 2014.12.16 09:48 UTC, Alpari UK Ltd., with the MetaTrader 4, real
Compared to the possible gains from trading with majors, the profits with minors usually fall significantly lower. An advantage in trading with exotics lies in the relatively well calculable currency stability. Exceptions can be found in the crisis (2014) around Ukraine and the resulting decline in the value of the Russian ruble. Minors are especially worthwhile to draw conclusions on major currency pairs. Exotic currency pairs are known as exotic currency pairs.

Tips for trading Forex currency pairs

Trading in Forex currency pairs is due to the demand of the currencies traded. Traders ultimately earn the price difference in the currencies they demand. The trader currently has 160 currencies and the resulting forex currency pairs are available. Since not every couple is meaningfully tradable at all times, Forex trading also depends on the pursuit of market events.
Long-term changes in a currency are easier to track and result from, for example, political decisions or economic partnerships. On the other hand, the prediction and purchase or sale of short-term fluctuations of certain exchange rates is different. Short-term changes in the exchange rate result from the current demand of the countries for foreign exchange, current trading transactions and speculative trading.
For traders with high risk appetite, both majors and minors with predictable price fluctuations are lucrative trading products.

Trading with majors is suitable for newbies of forex trading. It usually takes place at low spreads, such as the major EUR/UDs, which is usually traded at 1 PIP. The trade in exotics should only take place after a certain amount of experience. Newcomers can learn more about the Forex function and the opening of a forex demo account, learning to analyze economic data on the basis of charts and making first trade decisions with for.