Using time and currency-pair filters can significantly improve your range trading results. To better determine whether a particular currency pair is suitable for range trading, use the following checklist (the more checkmarks, the better).
Does the currency pair have a tight interest-rate spread?
Are you using a strategy that is suitable for range trading?
Is the signal occurring during a traditionally quiet trading period?
Is the calendar clear of any major event risks?
Do you have an intelligent stop with a drawdown that you are comfortable with?
The key to successful range trading is to be selective. You want to wait for an opportunity with the highest probability of success with the smallest risk. Although this is extremely qualitative and ideal, the bottom line is you want to have as many stars aligned in your favor as possible.
Subscribe to:
Post Comments (Atom)
Post a Comment