There is no single best Forex strategy but the one enclosed is one of the best and the reason it is is because: it will catch all major trends, is simple to understand, and will only take you 30 minutes a day to execute. Let's take a look at it.
How do Forex prices move? If you look at any chart, you will see they trend for long periods in a sustained direction and these trends can last for weeks, months and in some instances, years.
You can see this on any currency chart but you have to get into these trends and if you take a look at any currency charts closely, you will see that every major trend in any bullish currency, starts from a breakout to new highs and continues breaking new highs, as the trend advances.
So you want to get in on the big trends and the best way to do this is to simply go with breaks of resistance to new market highs. We will look at how to spot the best breakouts in a moment but lets stress a point which is important - despite this being a logical and obvious way to make money, most traders simply don't buy breakouts.
Most traders simply can't buy breakouts because they want to get in right at the bottom of the trend and they predict which is another word for hoping and guessing and lose. They won't buy breakouts, because they feel they haven't got the exact bottom and want to wait for a pullback - this never occurs on the best breakouts and the trend carries on, away from the breakout point.
The smart trader doesn't predict, he just trades the reality of the break and he misses the first bit of the move but compensates himself with the fact that, the odds are on his side and there is probably a lot of profit ahead. He doesn't want to be smart or clever and get the exact turn, he just wants to make money.
Not all breakouts make money, therefore you need to be selective in the breaks you buy. Look for a number of tests to occur before the break occurs and we very often look for double figure tests before the breakout and view the minimum number as four tests. In breakout trading the more times a level has held before the break, the more likely the breakout when it comes, will be a good one.
This is a simple strategy and it works. You can use basic bar charts and just trade price action or you can add a few indicators in to confirm your trading signal, if you wish and one or two to confirm is fine.
Trading breakouts and holding long term trends, will take you about 30 minutes a day but the profits from your work can be huge and give you a great second or even life changing income.
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