Forex Trading: Why Does It Follow The Trend ? :

It is generally advised to forex traders to trade in the trend of the moment rather than trying to go against it. Why ? This is what we will see in this article.

Assume that the market is always right and that it is therefore unnecessary to contradict it. The forex is so liquid that absolutely no intervener, even the richest, can influence the course of international currencies. In other words, nobody has any power over market developments. It is then preferable to apply a trading strategy in line with current movements and trends in the prices as they are more predictable.

Negotiating in the direction of the trend allows to benefit from the strong and secure impulses of the market. Indeed, a large movement on the prices consists, generally, of many small movements bullish and bearish.

When an uptrend is in progress, traders are picking upwards and tracing down. The course progresses in the form of stairs. At the end of a downward retracement ie at the beginning of a new upward momentum, it is wise to enter the purchase. When a bearish trend is in progress, it is exactly the reverse that must be made to get into position.

You will understand, trading in the trend is both simpler and safer. If you are seasoned and you perfectly master this type of trading, you can, however, also realize profits by trading against the current trend.