Why would a trader want to get complicated with counter trend trading? is this not simply going against most trading strategies?...
No, simply because the markets can and do move counter trend, knowing how and when to catch these moves is an art on its own!
Forex Markets
So what exactly do we mean by "counter trend trading"? is it not riskier attempting this type of trading? My response to this would be...well it depends on what the charts are displaying...let me explain.
My definition of "counter trend trading" is when a trade is placed against the major trend of that particular time frame - say for example, you trade the 10 minute time frame, the major trend must be determined or established on whether the 60 minute or the 30 minute chart or time frame.
So how do we go about doing this? Well the easiest and an efficient recipe is that, you must look at the position of the 200 enchanting average, plot this position on the lower trading time frame and ignore the local 200ma on the lower trading time frame.
On the lower time frame, if the price is some length away from the 200ma, then field to all conditions of the strategies shown on my site being met, then it would be determined safe to take this counter trend trade.
The fact behind all this is that, it is perfectly normal for price and the 200 enchanting midpoint to drift apart, but sooner or later they tend to catch up with each other, resulting in some extremely profitable counter trend trading moves.
Counter Trend Trading the Forex Markets
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