Best strategies for trading CFD
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The document discusses three strategies for trading contracts for difference (CFDs): 1) Going short with CFDs, which involves selling at a higher price and buying back at a lower price to profit from falling prices. This strategy uses contrarian techniques to sell when prices are high and buy when they are low. 2) Short term CFD trading, which analyzes short-term price movements within minutes or hours of news using hourly or shorter-term charts and indicators. This strategy follows short-term price momentum and trends. 3) Hedge trading with CFDs, which involves simultaneously buying and short selling similar CFDs in similar quantities to neutralize their price movements. This can be done over days
Best strategies for trading CFD
- 1. THE GROWING POWER OF SOCIAL MEDIA EASTWAY INSTITUTE OF PERFORMANCE ARTS EASTWAY UNIVERSITY OF SOCIAL SCIENCES WWW.EUSS.EDU BEST STRATEGIES FOR TRADING CFD'S TRADE WITH CONFIDENCE AND SECURITY
- 2. KEY STRATEGIES GOING SHORT WITH CFDS SHORT TERM CFD TRADING HEDGE TRADING WITH CFDS TRADE WITH CONFIDENCE AND SECURITY WWW.CAPITALSTREETFX.COM One can come across number of CFD strategies while trying to figure out how to trade CFDs. Before you use these strategies, you should know about the risk and returns related to them as this will assist you to hold positions for higher returns. Following are the 3 strategies to assist you with experience of additional flexibility of CFD trading. 1 2 3
- 3. Going Short With CFDs This strategy is The best way to earn profits by avoiding the herd mentality. Simplest strategy where you need to sell at higher price and buy back at lower price. 2. BUY 1. SELL Your decision is totally based on current trends in market and potential market tops. Contrarian investing techniques and indicators(for e.g. money flow index) can also be used. Sell when noise traders are buying, and buy when the same investors are selling. 0 10 20 30 40 50 Item 1 Item 2 Item 3 Item 4 Item 5
- 4. Short Term CFD Trading Start evaluating the short-term movements within financial markets. These movements occur within a few minutes or hours around news releases and market opens and closes. Use hourly and 5-minute or 15-minute charts for any given market to study these movements. Use short term indicators such as short period moving averages. These short term strategies follow the trend by looking at the price momentum and trend. 0 10 20 30 40 50 Item 1 Item 2 Item 3 Item 4 Item 5
- 5. Hedge Trading With CFDs Select those assets which have similar relative movements and trade them in a quantity that is nearly equal in monetary so as to neutraise their movements. Requires simultaneous buying and short selling similar/related CFDs in similar quanitities or monetary amounts. This can be done for the short term - over a period of days, or for a long term - over few months/years. You should choose assets that belong to the same market category, like Gold and Silver. 0 10 20 30 40 50 Item 1 Item 2 Item 3 Item 4 Item 5 0 10 20 30 40 50 Item 1 Item 2 Item 3 Item 4 Item 5
- 6. Thank You Capital Street FX WWW.CAPITALSTREETFX.COM