Trading Strategy When Market Conditions Sideways

monarchcb.com - There are 3 market trends, namely BULLISH, BEARISH & SIDEWAYS. If the price moves in a certain trend, then it will be easy for us to trade. Tracking trends is one of the most profitable ways to make money. However, when the market moves into SIDEWAYS action, this could be a problem because the majority of traders are confused, "Where do you want to go?". There are 2 strategies that can be applied so that you can make money from sideways market movements.

Trading Range

This is one of the best ways you can make a profit when the market is sideways. What you have to do is install a Pivot marker to find out Support and Resistance. After that, other markers that can help are the Relative Strength Index (RSI) and the Stochastic Oscillator. Once you know that the price is moving in a special sideways action, you can then quote a SELL in the trade when the price reaches the Resistance and quote a BUY when the price reaches the Support level.

Of course, you can't trade only based on Resistance and Support levels, but also use other markers to help you in entry and exit. Personally, I like to use the RSI and the Stochastic Oscillator. The rule is as follows: You can quote SELL as described above, assisted when the RSI and Stochastic Oscillator are overbought. After that you can quote BUY when the RSI and Stochastic are facing oversold. When the price is in the Support or Resistance area but is not supported by the RSI and Stochastic Oscillator, you have to think that the situation has not been verified enough to take a position.

Scalping

Scalping is a fast method of trading futures, quoting profits or exits in a short duration. In practice, you should use Support and Resistance levels such as Pivot or Fibonacci points to further maximize entries and exits. Similar to the trading range described above, you need to know the current range of price movements before you can execute this type of trade. Once you have determined the price range, then you can flow various Pivot Points or Fibonacci levels to help you identify entry points.

If there is a Pivot level or a Fibonacci level along with Support and Resistance, you can open a position (entry), then close the trading position (exit) when the price reaches the next level. For example: If you have opened a SELL order at R1 level, you can then go from your trade after arriving at the Pivot level. If you have a SELL entry at the Fibonacci level 0.5, then you can close the trading position when it reaches the 0.618 level.