One of the best ways to illustrate good forex trade entries is with examples. This article will provide example forex trade entry trade conditions for two pairs. However the same entry system and criteria can be extended to 28 pairs and 8 currencies. The 28 pairs are all combinations of these eight currencies: the USD, CAD, EUR, CHF, GBP, JPY, AUD and NZD.
Example Forex Trade Entry 1
The Forexearlywarning trading system has various alert systems. If one of the alert systems notifies you to check the JPY pairs, for example a price alert goes off, or a mobile app notification goes to your phone, then follow these steps. Check check the JPY pairs for a good trend and trading signal. In this case the trader receives a notification or alert the JPY is weak on The Forex Heatmap®, so the trader should consider a buy on one of these pairs.
The live signal above indicating JPY weakness resulted in a 70 pip movement on the CAD/JPY pair. This is enough movement to enter the trade safely and move your stop order to break even.
So if you bought this pair, and this pair is ranging between support and resistance on the on the H1 or H4 time frame, the trader would look to scale out lots and look to exit when the pair hits the next major resistance area on the same time frames. Scaling out lots means that if you bought 6 mini lots you close out 3 mini lots, then keep the remaining 3 lost until it hits the next major resistance area on the H1 or H4 time frames. The trader would also adjust the stop to break even on the remaining 3 lots. You can read this for more suggestions on how to take profits on a forex trade. If this pair is in an uptrend on the larger time the D1 or W1 time frames, the trader scale out lots and let the remaining lots ride the uptrend with a break even stop order.
Example Forex Trade Entry 2
In this second example forex trade entry, the trader receives an alert from our desktop forex market scanner tool, or the AUD pairs start moving after a news event on the world economic calendar. The trader checks the signals and trends and determines that the AUD is weakening on The Forex Heatmap®. This will drive movement on all 7 AUD pairs. The trader can choose to trade one of the AUD pairs, in this case sell the AUD/JPY.
The overall price movement on this example forex trade was over 140 pips. The trader can exit the trade completely, or if the AUD/JPY is in a downtrend, the trader can scale out lots , then keep the remaining lots and continue to hold these lots in the direction of the major trends like the D1 or W1 time frame. So there is more potential upside, with no risk.
Summary and Conclusions: In this article we have presented two example forex trade entry situations. The same criteria can be applied to 28 pairs comprised of the 8 most liquid currencies. With this trading system and procedures, traders can extract pips from the forex market. We have hundreds move examples of good forex trade entry signals and trading conditions on our website and social media pages. All of these example trades can be validated with any forex charting system.