Trend Following
One must come up with a xauusd strategy which they stick to when trading the online market. One must have the discipline to s broken then the trading sentiment of the strategy at all times. That is why it's better to come up with strategies that are profitable - profitable systems will be a lot easier to follow & stick to. This is because one knows that by following the rules of their system they will be successful.
A carefully designed strategy that has been back tested & proven to produce profitable results is one of the keys to becoming successful when trading the trading market. This type of strategy will make it easier for trader to follow the rules of their strategy because they already know that the trading strategy is profitable, therefore keeping up the discipline to continue following the strategy will be much easier.
Successful xauusd strategies will also include:
1. Gold equity management guidelines
2.Gold Psychology Mindset
These two will greatly improve the success of any xauusd system.
However, Let us look at price action method before narrating on xauusd money management & xauusd psychology.
Trend Following Strategies
Trend following strategies are depending on first of all determining the overall market trend, whether the market is moving upwards or it is moving downwards. After determining the market trend the trader will then only open trades in one direction.
Upward trend - in an upward trend prices keep moving up, and here the trader will keep opening buy trades.
Downward trend - in a downward trend prices keep moving down, and here the trader will keep opening sell trades.
There are different strategies of determining the market trends and the two most popular ones are:
Trend lines - traders will draw trendline on the price chart to determine the current general market movement. Once the market trend direction is determine a trader will then open trades once the price touches the trend line or when price is close to the trend line. The trader will only open trades in the direction of the trend.
When markets form trends, the market trend will have a lot of momentum & this momentum will mean that the prices will keep moving in that direction for a period of time that lasts for quite some time.
Trading the market trend is one of the most profitable way to trade the market if a trader catches a trend that has already formed they can make a lot profit just by trading in the direction of the trend and the longer the trend stays the longer a trader can continue to make profits. Some major trend may last for years and these can prove to be the most profitable setups especially when they last for years.
Moving Averages Strategies - Another trend identification strategy is the use of the 20 day moving average, and when prices are above this moving average the market is bullish and if prices are below this moving average the market is bearish.
The 50 day moving average is also used for determining the medium term trend, while the 200 day moving average is used to determine the long term trend of the trading market.
Traders can also use 2 moving averages to form the moving average cross over technique, this method will have a shorter period moving average and a longer term moving average & these 2 will be use to determine the current market trend. For examples a trader can use the 5 day & 7 day moving averages, and for this strategy the trend is upward if both these moving averages are moving in the upwards direction and the trend will be down if both these 2 moving averages are moving downward.
This system will indicate the trend is about to change one these 2 line cross over each other. This signal will be a god time to close trades if a trader has open trades.
XAUUSD Strategies Tips
Once one has come up with their strategy, they should also try to include the following to make their strategy more successful.
1.Gold Equity Management Tutorials
2.XAUUSD Psychology
XAUUSD Equity Management Tutorials
Xauusd equity management rules should be part of your strategy - the trading rules will help you to manage risk. This means that you'll use two rules of xauusd equity management - these are risk:reward ratio & drawdown reducing method when placing your trades to determine lot size that you'll open in trading market. The most popular equity management rule use in xauusd and the one that you should also add to your plan is the rule which says a trader should never risk more than 2% of account balance on any one single trade transaction.
To learn & know more about these 2 equity management rules, traders should study the money management tutorial that's on the learn xauusd courses section of this website under the key concepts tutorials.
Gold Psychology Mindset
In order for a trader to become successful when trading the market a trader has to learn about xauusd psychology. The psychology or mindset that's needed to become successful in xauusd is one that avoids the emotions of fear & greed while trading the market and is a mindset of total discipline that a trader will follow all their rules & their strategy and only trade with signals that are generated by their strategy. With discipline one won't trade unless their strategy gives a trading signal. One will have the mindset of only following their system 100% all the time without second guessing the system. A disciplined trader also will not open trade transactions in market just because the market has started to move up-wards or down, instead a trader will wait for a trading signal to trade to be generated by their strategy.
In order to know more about xauusd psychology and how to manage emotions while trading the online market a trader can read the psychology guides from the learn xauusd courses section of this website under the key concepts tutorials.
