“Best Trading Way To Make Money” is the most sought-after skill for both new traders and inexperienced day-to-day traders in the Forex or Volatility Index trading world.
Learning how to trade is really important for you to stay in the financial trading industry. Controlling your emotions during Forex or VIX trading is a topic for another day.
Essentially, it is good to learn how to manage a business before starting such a business in recent times.
However, there are numerous ways that you can engage in FX or VIX trading and make profits on a daily basis.
One of such trading ways is by means of combining strategies to generate perfect trade signals.
Combination of support and resistance with candlestick patterns and Fibonacci strategy is one of the great trading ways.
Technically, the goal of this trading method is to make profit while trading price retracements from support or resistance zones/zones with the use of the Fibonacci tool.
You may use this method to trade Forex assets, NASDAQ 100, XAUUSD and volatility index over any period of time.
However, a time frame of 30 minutes or more will be ideal for Forex, NASDAQ 100 and XAUUSD assets.
A time frame of 15 minutes or longer will be ideal for volatility index assets.
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The first and ideal step is to identify a trend on the chart. (You should not use this method in a ranging or consolidating market).
The images below shows price movement in a Bullish and Bearish trend.
The second and also vital step is to map out the swing high and swing low on the trend. Highlight the Support and Resistance area.
The images below show price forming SWING HIGH and SWING LOW turning points.
Moreover, you need to identify the candlestick reversal pattern at the end of the trend (such as Doji, Engulfing bars, Harami, Pin bars etc). If there is no reversal pattern, wait till one shows up.
The need for you to wait for the formation of any of these patterns before placing your trade entries cannot be over-emphasized
Now, you can draw your Fibonacci levels to highlight the trade entry (preferably at the mid point of 23.6% and 38.2% Fibo level).
Also map out your take profit levels (Tp1 38.2%, Tp2 50%, Tp3 61.8%).
Finally, you need to place your stop loss a little pips distance below/above the zero percent Fibonacci level.
Enjoy your profit(s).
Note: There isn’t a perfect strategy for trading currencies or the volatility index in this world. As a result, there will be times when you will make losses.
Most importantly, the moments when you don’t wait until the inverted candlestick patterns appear at the end of the trend before you draw your Fibonacci levels.