A strategy for CFDs trading consists of two parts. First part is the actual trading strategy according to which the trader searches for interesting trading opportunities which are expected to be profitable. The trading strategy may include e.g. the analysis of price graphs or following economics news. The second part is money management - money management tells you how to wisely manage your trading capital and reasonable choose the amount of a single trade.
Indicators for price graph analysis
This list for the time being mentions trading indicators which are used for technical analysis in the MetaTrader platforms and the subsequent placing of trades with brokers. Everyone uses a different strategy for trading CFDs. But it is important to mention that you should never trade without enough skill or enough testing and experimenting, always look for detailed information which you understand. If these indicators interest you, make sure to read detailed articles about them.
- Bollinger bands (BB) - these are bands around prices. They are based on the standard deviation, so for example with the setting of Sdev=2 the price moves inside the specified range 97% of the time and in just 3% of all cases it is out of this range (above or below the range).
- Volume indicators - these are excellently explained e.g. in books from Anne Couling
- BandWidth (width of Bollinger bands) - when the volatility is higher, the bandwidth increases and vice versa
- Simple Moving Average (SMA) - one point on the graph represents the average of closing price in e.g. the last 30 periods (a period can be e.g. 15 minutes).
- RSI (Relative Strength Index) - a technical indicator that compares recent gains to recent losses.
Financial market events calendars
Forex Factory (forexfactory.com) - website which offers a free event calendar
These calendars allow you to browse through the months, weeks and days and view important trading events which have the potential of moving with currency values or stock prices. A good fundamental strategy for CFDs is as follows: regularly watch these calendars and watch out whether there is some event that may move with the price of an asset you are trading.Make money in three easy steps!
My method cannot be used everywhere. Most banks and traders do not know what this method is about. And even when they do know about it, they would never, under any conditions, provide it to ordinary people. That's why it's very important to choose a reliable licensed broker who will allow you to make money. These are my two favourite brokers. Register with one of them - or even both of them. They both offer advice, video tutorials and a personal adviser - absolutely free.
Try out the strategy with a demoversion:
Minimum deposit: $10
Minimum deposit: $250