There are a lot of traders and newcomers who want to make money in Forex, but only 5% of them ever do. The question then is what the 5% of Forex traders who are making money are doing that the other 95% aren't.
In reality, anyone can make money in Forex as long as they learn how the market works and educate themselves. Key support and resistance zones can be used by traders to enter and leave the market. Pivot points are another important factor that will help determine how prices move. Pivot points help traders figure out where prices are going and when trends change.
If you knew the range parameters that floor traders used, you might be able to figure out where off-floor and position traders could take over the market. To predict price movements in the Forex, it is important to find key support and resistance zones and pivot points. Even if you don't trade every day, knowing the key pivot point, support and resistance points can help you find possible entry points and stop loss levels.
It's a double-edged sword to enter a trade near key support and resistance zones. Pivot points can be both risky and a great chance to get into a trade. Stop orders to enter at pivot points are easily tossed around by the local market and noise. This means that prices may go up and down around pivot points before moving in one direction. The next question is how pivot points are used to find good times to enter and leave the market.
There are two ways to use pivot points. The first way is to figure out the overall trend of the market. If the pivot point price is broken up, the market is bullish, and if it is broken down, it is bearish. Keep in mind, though, that pivot points are only useful for a day before they need to be recalculated because they show short-term trends. The second way to get in and out of the market is to use pivot point price levels. For example, a trader might put in a limit order to buy 100 shares if the price breaks through a resistance level. A trader could also set a stop-loss for his open position if a support level breaks.
It is not easy to figure out pivot points. There are some really good training courses online that will teach you how to trade using pivot points, calculate them for you, and show you how to use them in real time.
