Making profits from short-term trading is highly possible in forex trading as it is a leveraged market. Therefore, investors can quickly boost profitability by increasing the buying power of money.
However, making 1000% profit means you are in a world where your trading accuracy is higher than an ordinary trader. Therefore, it is possible only when you have a profitable trading strategy and are ready to trade with solid risk management.
Financial market trading needs additional attention to the intraday chart, providing the juice of a core movement. Remember that the market does not move all day, but it includes profit at a particular time, and in this strategy, we will see how to catch those movements.
What is short-term trading?
Any trading strategy in a lower time frame is known as short-term trading. However, traders can use this method to catch smaller gains in higher time frames or moderate gains in lower time frames. Any take profit level from 1 pip to 50 pips is known as short-term trading, but the main aim is to remain profitable. No matter the time frame or target profit you use in your trading strategy.
However, not all short-term trading strategies are capable of providing 1000% profit. Success in financial trading depends on implementing your trading knowledge in the chart with proper risk management. A simple trading strategy with a strong risk management system would provide you with more profits than you think.
Therefore, we are sorry if you are looking for a holy grail in forex trading in this article. In forex trading, no one knows where the price is heading. However, the major players in the forex market are banks, as they have enough liquidity to make the price move. As a result, we will trade in a time frame where major market participants, usual banks, are active in this trading strategy.
How to identify the short-term market direction?
The forex market is open 24 hours a day and five days a week. Therefore, you are open to trade from Monday Tokyo Session to Friday New York session. Within 24 hours, the market session is distinguished as Tokyo, Sydney, Frankfurt, London, and New York trading season.
The maximum liquidity in the forex market comes from the USD. Therefore, it is wise to trade in the US session to get the maximum benefit. Among other sessions, the London Session is important. Therefore, if you are interested in making a 1000% profit from short-term trading, you should only trade on London and New York sessions.
When the London session opens, London traders will break out the price from the Asian range. However, the breakout will not extend as New York traders will come and reverse the momentum. In this reversal, the price will make a pattern, and we are interested in this pattern only. In this trading method, we will ignore what the price does at other times.
Let’s see an example of the reversal in the New York session.
The above image shows a five-minute chart where the New York and London session is marked. After breaking the Asian high or low, the price made a sharp bearish movement and formed a W pattern. Once New York traders come, they make a price reversal with a pattern that we are interested in this strategy.
A short-term strategy
We will stick to the intraday chart in this method’s short-term and long-term formation as it is short-term trading. The exact short-term method is to open trades in the five minutes chart.
Bullish trade setup
In this method, the number of trades is lower than a traditional trading method, while the accuracy is higher. Therefore, investors can easily make a 1000% profit using this method.
Before opening a buy trade, make sure that the overall market context is bullish. Later on, the price should remain corrective at the Asian session from where you should mark the Asian range. Once the London trader comes, the price should break below the Asian low and make a new daily swing level. Later on, the price should form a W pattern from the new swing low during the New York session.
Bearish trade setup
In the bearish short-term trading section, we need to find a bearish market where the price should move up from the Asian range and form an M pattern in the five minutes chart. Make sure that the pattern came from a new swing level, and the trade becomes valid once the price breaks below the pattern.
A long-term strategy
Although it is a long-term strategy, we should follow the same pattern in the 15 minutes time frame. Investors will have a higher risk and reward ratio with a more robust success rate than the short-term version in this trading method.
Bullish trade setup
Like the short-term version, the price should form a range during the Asian session while the overall market context is bullish. First, find the price to break below the Asian low with a W formation in the new swing low. Open a buy trade once the price breaks above the W pattern with a bullish candle breakout. The stop loss should be below the pattern, and the take profit is based on near-term levels.
Bearish trade setup
It is just the opposite version of the bullish trade setup where the market context should be bearish, and instead of the W pattern, investors should find the M pattern from the swing high.
Let’s see an example of the bearish trade setup.
Pros & cons
|This trading method applies to any USD-related pairs.||It needs additional attention to the market context.|
|Profitability is very high in this method.||A strong trade management system is needed.|
|It can explain institutional traders’ activity in the price.||It needs practice before implementing this method in the real chart.|
Making 1000% profit from forex trading needs additional attention to the trade management. Make sure that the forex market is not a quick-rich scheme where you can become a millionaire overnight. Instead, it needs close attention to how the market behaves, and matching the sentiment would bring success.