How to Determine Buy or Sell Positions in Forex Applications

It is undeniable that novice traders often ask about how to determine buy or sell positions when they want to start trading. Indeed, sometimes you often get confused when you want to take a position after seeing the price moving quite quickly in one direction, but a moment later, the price turns out to reverse direction. So how do you deal with this?

Before trading, you must have done research or research that by having an indicator, you can identify a turning point or trend. But it turns out that’s not the problem. Also not when you have chosen a suitable currency pair for trading. The problem lies in when is the right time to enter a position or what level to enter the position. Please note that this is one of the things to consider when learning forex online.

So when should you buy and when should you sell? This question is often asked by a trader, especially novice traders who are just entering the world of forex. The right answer to that question is please do an analysis! By doing analysis, you will know when is the right time to buy and when to sell. You even know when to stay still or wait until a certain signal appears.

How to Determine Buy

To determine the buy time, you need to first determine which direction the market will go up. Here are some examples of characteristics of the market going up when:

1. Candlestick Chart Declining, Body Candle Getting Smaller

A falling chart does indicate that at that time the seller is more dominant. But when the body candle gets smaller, this indicates that there is resistance from the buyer, so that the downward pressure will be defeated by the upward pressure. Well, when the upward pressure is greater than the downward pressure, this is when the market starts to rise.

2. Market Penetrates the Nearest Resistance Line

The resistance line is made from at least two parallel peaks. These two peaks will indicate that at that level, the price is being maintained by the seller. However, when the resistance line is successfully penetrated, the seller’s position has lost so that it requires strong power to penetrate it. This proves that the buyer’s power is large so that buyers still control the market and the market will continue to soar.

3. Signal Indicator Changes

Most indicators are designed from the development of Moving Average which is the average market price in a certain period. When this average price is above the graph, it means that the market movement is weakening so that it tends to fall. Therefore, when the indicator value changes direction to below the graph, this indicates that there is a strengthening in the market which will have an impact on the market increase.

4. Uptrend Correction Stops

A correction is used to ensure that the market direction is correct. Therefore, when the correction has stopped, the market will move again in the previous direction.

It has been explained in point number 3 above that the indicator value is a reflection of the market movement conditions. This means that the indicator value comes from the results of processing the market value that occurs. The market direction and the indicator direction should be the same. However, when there is a deviation made by the market, it could be that the correct direction is the direction of the indicator.

5. Bullish Body Candlestick Chart is Getting Longer

When the candlestick body starts to lengthen, this indicates a dominance by one party, either the buyer or the seller. If a bullish candlestick appears with a longer body than before, this proves that the buyer’s dominance is getting stronger. Please note that the normal condition is that the market will continue to rise until the buyer’s dominance is defeated by the seller.

How to Determine the Sell Position

The same as open buy, what you need to pay attention to when you want to open a sell position is to follow the current trend direction. When is the right time to make a sell action, depending on the signal you use against the system. The more you can understand the system used, the more you will understand when to make a sell.

If open buy is done when the market is rising, then the opposite, if you want to make a sell, then you need to make a sell when the market is falling.

Here are the characteristics of the market going down when:

The candlestick chart is getting higher, but the candle body is getting smaller
The downward trend correction stops
The market breaks through the nearest support chart or base line
The market is getting higher, but the indicator is decreasing
The signal indicator changes from below to above the main indicator chart
The bearish body candlestick chart is getting longer

In addition, you can also take a sell position when there is a downtrend and coincidentally the signal on the system is doing an over or cross action. Now is the right time to take a sell action. At the same time, prices will tend to move fluctuatively and can make movements erratic. Therefore, stick to one down, namely following your system rule and sell when a cross occurs. But remember, don’t do anything when there is no signal.

So When Should You Buy or Sell?

After reading the explanation above, do you still want to ask the question “when can you do a more appropriate open?” The answer is when open buy or open sell will be right away without having to experience floating. This trend is very important, even before you make a forex transaction, the first thing to do is analyze the trend prediction. Don’t immediately open a position when you don’t know the direction of the trend. This can be more dangerous if you don’t know the movement prediction.

After you know and understand this problem, at least don’t trust 100% of the analysis if the basis you do is very doubtful. The predictions you make must be accountable. When you already know the direction of the trend movement by observing the trend and there is no money management, the trading process will certainly be uncertain.

Organized trading can be done by preparing the right management. So, without money management trading, it will be in vain. As for money management itself, sometimes it is not cared for by some traders who will actually use large transactions. It is unfortunate that they are proud to be able to open with super volume on the grounds that the results obtained are greater and return capital quickly.

Final Words

Those are some explanations regarding the characteristics of the market moving up and down that you can use to determine open buy and sell. Therefore, when you do the analysis and see the conditions above, you can determine where the next direction is to decide when is the right time to open buy or open sell.

The way to determine the buy or sell position above is very effective because it adheres to the basic rules of market movement. However, to maximize its use, you must also get used to observing market conditions before trading. Thus, your instincts will be sharper in recognizing the next market direction.

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