6/24 Analysis: Trading Without Momentum
Today, I’ll show you how to trade a breakout at the open when we don’t have momentum yet in the market. So at the London open, the GBP (red line) is strong and a few currencies down below including the EUR (pink line), CAD (green line) and USD (blue line) are weak. However, ideally we want the lines to the far right to be very steep indicating current momentum in the market.
We don’t have that right now, so how would you go about trading this?
All you have to do is set pending orders 10 pips below or above the current price so that as price starts continuing in that trend, your order would be triggered allowing you to ride that momentum. Let the market confirm the move for you. Either you get in and ride the momentum or you are not triggered at all risking nothing.
- EUR/GBP SELL
So this is a good example of where the downtrend reversed and never would have triggered your sell order. You have nothing risked as the market moves in the opposite direction.
Watch the video analysis here:
You can see that our Currency Strength Indicator is an effective tool for picking out the highest probability, lowest risk trade set ups while avoiding market conditions that aren’t favorable. If you keep using this tool every day along with our daily Forex analysis, you will increase your win rate and be on your way to becoming a profitable trader long term.
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