Last update 2121.01.18
Analyzing market trends and reversals are fundamental concepts in technical analysis 📊. In this article, we will help you understand how to trade a trend, versus trading a trend reversal to improve your forex trading performance.
What you can learn ahead 🎓
- Understanding trend and reversal in forex
- How to seize opportunities of trends
- How to invest in forex with automated AI trading
- What are the best forex brokers to trade?
🎯 Our mission is to help you invest efficiently in forex and improve your results. Get extra valuable forex trading ideas from leading finance experts on the trading Academy and our free forex Telegram channel.
💹 When trading forex, we suggest you consider long term results.
Understanding trend and reversal in forex
Cutting to the chase, Trend trading occurs when you profit by following the existing price direction, which can be the main trend for a given time-frame.
- When the main trend ends, another trend may emerge and cause the price to follow a different path than before.
- A contrarian position is when one is expecting a trend reversal and is the reason for counter-trend operators.
Concepts of an asset being traded at a premium, or above its intrinsic value (overbought) or below at a discount, or below its intrinsic value (oversold) are quite common when trading. These concepts are true whether trading shares, forex, or nearly any asset class, and are echoed in the famous saying “buy low, sell high.”
Trend following is often perceived as a strategy that simply “follows the herd”. However, this metaphor is inadequate, as the strategy has been shown to be particularly profitable precisely when it holds positions that – at least, initially – are at odds with the prevailing market consensus.
Buying low and selling high, especially during trends and trend reversals, is one of the key points that we cover in this article.
A view of forex market trends and reversals
The overall attitude of investors toward particular security usually reflects its historical and current price movement, which creates a market sentiment of that asset. This market sentiment reflects not only the supply and demand factors but also the crowd psychology in terms of expectations and consensus. These sentiment indicators also connect concepts of overbought, oversold, and support and resistance levels.
In trend trading, you must identify that a trend in the price exists and must hope the price flow will follow the momentum. Identifying the trend and taking the right position can help you minimize the risk or recover later on from a losing trade if the trend resumes.
And in counter-trend trading, you must identify a trend reversal and follow it to profit from a trend reversal.
Searching for indicators, signals, systems, and determining the ones you think are best for your goals is very time-consuming. Most traders lose money because they have not prepared properly.
WiseInvest signals are the result of testing and validating with powerful and modern computational methodologies. After stress-testing a large number of various strategies, the best fit for us was trend trading.
From now on, we hope it will be more clear in your mind what is trend trading is versus trading a trend reversal.
The best way to trade forex
There are two ways to invest with our AI in forex without concern about trend and reversal:
1. Automated with AI-Trading. Check out the 3 steps to trade automated with our AI.
By trading forex automated with AI, you will save time and improve your performance without monitoring the market and managing trading platforms.
With Automated AI trading you do not need MT4 / MT5 and other trading platforms to invest in forex. All forex trades are automatically placed into your broker account every time that our AI system identifies a new worthy trading opportunity. You can monitor the AI trading performance in real-time directly on our dashboard.
Automated AI trading benefits ✅
- Setup in 3 minutes.
- Totally hands-off, from anywhere.
- Invest from just $100.
- APY of 40% over the past 13 years*.
- Lightning-fast execution & no slippage.
- No commissions, no management fees.
- Portfolio with 40 different automatic strategies.
- No MT4/MT5 or other platforms required.
- Test with a risk-free practice account.
- Trading results directly on our dashboard.
Don’t you have a broker account yet? Our AI is integrated to trade automated with the broker Oanda. Click here to open an account.
2. Manually with AI forex signals.
Wiseinvest also provides AI forex signals that perfectly fit into MT4, MT5, and any trading platform. To trade with our AI forex signals, you must simply copy the data you receive from each real-time signal into any forex brokerage account of your choice.
There are five unique variables for each AI signal, and each must be copied exactly, to match the performance of the signal as close as possible.
Each AI forex signal alert consists of the following five data points:
- Symbol (forex pair)
- Direction (long or short)
- Position size (number of units or lots)
- Take profit (price level to exit with maximum gain)
- Stop loss (price level to exit with maximum loss)
Check out how to trade with our AI forex signals.
- Subscribe to a Wise-Plan.
- Open a Brokerage account. Check this article about the best forex Brokers.
- Set an amount and a position size on our Wiseinvest dashboard.
- Our AI will send you real-time trading alerts by email and Telegram.
- Copy the signals and paste them into your Brokerage account.
All forex signals are sent every time that our AI trading system identifies a new trading opportunity. Our trading strategies are developed on a variety of time frames such as 4 and 8 hours.
Wiseinvest AI forex signals are Market Orders and you do not need the entry price. You can copy each signal while it is available on our dashboard. We do this way to assure that traders will just place signals while they are good to be traded.
You can trade forex with our free forex signals clicking here, or with our Premium subscription that provides you unlimited AI signals and automated AI trading in partner brokers. Whether you are a beginner or a professional forex trader, our AI trading system can help you save time and improve your trading performance. Get started with free AI.
When investing through Wiseinvest automated AI trading or AI forex signals, you do not need to calculate pips and change the leverage in your forex broker account. Learn more about leverage in forex trading by clicking here.
What is the AI performance in forex trading?
The Win Rate of our AI moves as shown by the period and can reach up to 95%. The performance relies upon the capable wild estimation metric, which infers that our model is valuable at whatever point the Win Rate is more noticeable than 60%. All methods of our AI trading system search for stable returns and sufficient results to achieve an ordinary return of 40% consistently (APY), without the usage of high impacts.
We appreciate that what is significant in forex trading is the definitive result. Thusly, the money related master needs to consider that Win Rate isn’t commonly the best estimation to measure execution in forex, as other signals providers uncover. For instance, out of 100 trades, solitary 1 trade may be an adequate disaster to make the 99 trades not gainful. For this circumstance, the Win Rate would be 99%, yet the convincing result would be unfeasible (negative).
We revolve around the appearance of 40% of APY and not just on Win Rate.
It is essential to see that forex brokers may charge spreads, commissions, and overnight costs in your trading account, and these components can impact the AI execution. You can check our forex trading history to see more about AI trading execution by clicking here.
How much do I need to trade forex with AI?
You can start in forex trading with free AI forex signals or AI trading record and make a store from just $100 in the broker. It is moreover possible to test using a danger-free practice account with our AI trading structure. Regardless, to do a capable peril, the board in authentic records, we suggest you start from at least $100. Notice that some forex traders require assorted beginning stores to trade forex.
What is the trading strategy of our AI?
Our AI methodology is the blend of different AI trading structures, with more than 100 features, that portray 40 particular procedures which simultaneously consider: Quotes of the 28 forex pairs, Supports, and Resistances in different timeframes, Trends and Counter-designs, Cross-markers, Index of each pair, Economic Calendar, Investors Sentiment.
Our AI looks at those fundamental, technical, and sentiment factors that impact forex trading, and all models are surveyed constantly using different burdens. In the wake of completing the examination, the choice of the signal transmission procedure is made considering the improved likelihood of flashing advantage and the total open for theory.
Using technical analysis, our count considers not simply the instances of various examples, including sponsorship and deterrent levels and cross-pointers, yet our AI is moreover prepared to make its own progressing record for each cash pair, that is used to recognize what is the best course and target.
Practically identical to fundamental analysis in forex, the AI makes an association inside the budgetary calendar to find news data that can impact express money sets.
Disclaimer: Forex and Contracts for Difference (CFDs) are complex instruments and come with a high risk of losing money due to leverage. Forex trading is not suitable for everyone. You should consider whether you understand how forex and CFDs work and whether you can afford to take the high risk of losing your money.
The forex brokerages displayed shall disclaim the overall performance of traders in their platforms. Oanda warns that 76.8% of retail forex traders lose money trading CFDs. XTB warns that 80% of retail forex traders lose money trading CFDs. FXCM warns that 74.74% of retail forex traders lose money trading CFDs.
The performances aforementioned are not related to Wiseinvest AI forex trading and AI forex signals system. You can check the performance of our AI forex system on our dashboard.