How To Trade Pullbacks With Confluence (Forex Trading Strategy)
In this (live) video, I share how to trade pullbacks in the Forex market. I give several examples of detailed trading strategies that can be applied to gain confluence when trading.
What's important when trading pullbacks, like any other trading strategy, is to keep a consistent technical analysis methodology. Many traders looking at how to trade pullbacks will end up looking at too many tools to “catch all the trades”. That is approaching trading with the wrong mindset.
In addition, it is important to note that pullback traders do not typically rely on a high win rate. From what I have heard on the Desire To Trade Podcast, trend traders usually see a 25-35% win rate. That is quite low! However, those traders rely on a significantly high reward-to-risk to make their profit.
Common tools that can be used when trading pullbacks include (but aren't limited to):
- Fibonacci (which I'm not a fan of)
- Bollinger Bands
- Moving Averages
- Support & Resistance Areas
I also touch on an important idea; the fact that the use of candlesticks in trading helps us find areas to place stop losses. This is a tool I use on a daily basis for that reason.
For a complete pullback trading strategy taken from a book, read Forex Trading Strategy for Trending Markets.
Listen (podcast episode): 064: Trading Strategies For Trending Markets – Part 3
If you are aspiring to trade for other people while traveling the world, you might want to consider checking out the Desire To TRADE Academy where I'll help you do precisely that!