Introduction:
With so many markets to trade, how do you know what strategies work best for each?
In this guide, we’ll break down suitable strategies for forex, crypto, stocks, and other major markets.
Forex Strategies
For currencies, leverage means high volatility. This favors strategies like:
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Breakout – Trade accelerations in volatility after ranges or consolidation.
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Momentum – Follow trends amplified by interest rate differentials.
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News-based – Macro moves based on GDP, NFP reports, etc.
Crypto Strategies
Crypto’s extreme volatility suits strategies like:
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Momentum – Ride the waves of speculation and hype/panic cycles.
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Swing – Catch major swing highs and lows in a range-bound market.
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Arbitrage – Exploit pricing inefficiencies across exchanges.
Stock Strategies
For stocks, broader economic shifts dictate trends, favoring strategies like:
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Fundamental – Analyze financials like P/E ratios and growth.
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Chart patterns – Trade tactical formations like wedges, channels.
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Quantitative – Data-driven approaches based on factors like valuation.
Commodities Strategies
For commodities, seasonal supply/demand and roll yields influence prices. Useful strategies are:
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Curve trading – Profit from rolls and contango/backwardation.
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Mean reversion – Trade reversals to the mean.
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Seasonal patterns – Take positions ahead of known periods of strength/weakness.
Conclusion:
Match strategies to each market’s unique attributes.
A momentum system in crypto may fail in stocks.
Stay flexible and realize strengths and weaknesses vary.
Combining complementary strategies expands opportunities.