When trading in the foreign exchange market, you need to remember that it is not enough to own analysis tools, you also need to create your own strategy. Trading tactics are formed by their various techniques, which consist of sequential or parallel operations. Using a trading strategy allows you to reduce losses to a minimum, and sometimes even increase profits. One of these tactics is "lock".
Instructions
Step 1
Use the "lock" trading strategy in the case when the open rate becomes unprofitable by at least 50 points or if a sharp reversal of the exchange rate is planned. To minimize losses, a counter trade is formed, the opening point of which should be as close as possible to the opening of the first position.
Step 2
Back up a profitable trade. For example, you bought a currency while watching an uptrend. However, during the day, the resistance line is expected to cross, from which a rebound is possible. To be on the safe side, place a sell order at the resistance point, which will form a positive lock.
Step 3
After that, do not pay attention to the lock, as this will prevent you from analyzing the situation. The exit from the castle takes place in the following ways. If the price bounced off the resistance line, but a reversal to growth is expected soon, then the sell order is closed, and purchases remain to increase profits. If the exchange rate breaks the resistance line, then you need to wait for the moment when it returns to the support level, and then close the sales.
Step 4
Minimize losses by forming a negative lock. For example, you dig in the hope of an uptrend. But instead of rising, the price breaks the support line down. As a rule, in this situation, stop-losses are a safety net. However, you can place a sell order at this moment. Thus, you do not close a losing trade, but open the opposite position.
Step 5
To get out of the castle, the next support line must be identified. Then close the position that will become unprofitable in the future. Using a negative lock is dangerous in that there are no loss limits. In the event of a sharp change in the exchange rate and with carelessness, this can lead to serious consequences. In this regard, it is necessary to use this strategy only with sufficient experience and knowledge.
