“The trend is your friend” is much more than a catchy rhyme in the foreign currency market. It can give you an indication on the general direction of the market. When analyzing a trade the trend should be your guide post. Trend analysis is based on what has happened in the past giving you an idea of what may happen in the future.
While currencies often trend for weeks or months, they don’t move just up or down. They move in waves. So a trader needs to know if today is likely to be a trend day or a counter trend day and trade accordingly.
You can identify the trend by the patterns the price movement forms. They indicate up or down price movement history. My trading platform enables me to quickly and accurately identify monthly, weekly and daily trends right on my trading chart regardless of that time frame, without having to use individual charts and monitor space for each currency. For instance most traders may have a daily chart up to see how it trended over the last few days to a month+. They may also have open an hourly chart to see easily the last 2-3 days movement. But if you’re a smart trader you will develop or find tools that SHOW you all this on ONE chart, thus freeing yourself up to watch more currencies and spot more opportunities!
It is important to have an overall picture of the trend for an accurate trade analysis. Looking at the currency trend history, you will see that the price moves in cycles often described as waves. You can identify the extreme highs or lows “peeks” and “valleys” that often forecast a reversal of the price movement by revealing higher high price or lower low price.
If the market is not truly trending up or down it and basically moving sideways, it is considered to be in a range and this is when we wait for it to break out of that range and resume the trend. Through the mentoring program you learn to use its elite tools that identify specific conditions when the trend isn’t your friend at that particular time and how to cope with it. It is always best to trade with the trend but if conditions depict different circumstances you have to be versatile. “Just roll with the flow”. Be patient, continually analyze the market conditions and choose winning trades regardless if the market is trending or ranging.