Trading Strategies : Super Trend

Forex Introduction

This is the ideal tool to use with trends and optimize your output. Super Trend is moving above or below the price depending on the trend in progress. It moves with the price as a stop loss except that it does not progress or does not stuck to the price during congested areas. This gives more space and time for prices to move, giving you the opportunity to capture a larger movement. You can use it as an indicator of output when it will change of direction or to set your stop loss.

Forex Application of the method

Entry point: Generally, it is better to focus on long positions when the Super Trend is moving below prices and conversely it is better to take only short positions when the Super Trend is moving over prices. It is possible to strengthen its position when the price comes banging on the super trend without crossing it.

Exit Point: The output occurs when the Super Trend changes of direction. Note, however, the stop loss should be placed slightly above or below the super trend according to the side of your position. More the timeframe is high; more you should move aside your stop from the super trend. Indeed, it often happens that the shadows of candlesticks cross the super trend but the close price of the candlestick is finally done on the super trend for after provoke a rebound of the price.

super tredn strategy

Forex To sum up:

Advantages: Allows you to enjoy big movements; Do not stick to the price and therefore avoids many false signals when sideways trend or market correction occur; can be use on all timeframe, offer very good performance, ease of use

Disadvantages: Stop losses are often far from the price because the super trend donot stick to the price

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