AUD/USD: Power of round numbers in forex trading
A look at the following downtrend in the AUD/USD currency pair shows 3x 300-pip swings that start and end close to round numbers.
The swings in the price sometimes stop almost perfectly at the round numbers, but sometimes they fall just short or runover them before reversing. Which one happens doesn’t matter for the purposes of a swing trader. If you are targeting a 300-pip profit on a forex trade, you don’t care about missing 20-pips or even 50 pips at the start or end of the move. Your sole objective is capturing those core 300 pips. The scalpers and day traders can fight over the rest.
Hope this was instructive
The swings in the price sometimes stop almost perfectly at the round numbers, but sometimes they fall just short or runover them before reversing. Which one happens doesn’t matter for the purposes of a swing trader. If you are targeting a 300-pip profit on a forex trade, you don’t care about missing 20-pips or even 50 pips at the start or end of the move. Your sole objective is capturing those core 300 pips. The scalpers and day traders can fight over the rest.
Hope this was instructive
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Market Analyst at WeTrade
wetradebroker.com/education/analysis/jasper/
Contributor to SpreadEx
spreadex.com/financials/news-analysis/weekly-technical-analysis/
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