Learn Oil Trading Trend Reversal Strategies
A trader must come up with a oil strategy which they stick to when trading the online crude oil market. A trader must have the discipline to follow the rules of their oil trading strategy at all times. That's why it is best to come up with trading strategies that are profitable - profitable oil systems will be a lot easier to follow and stick to. This is because a trader knows that by following the rules of their trading system they will be successful.
A carefully designed trading strategy that has been back tested and proven to produce profitable results is one of the keys to becoming successful when trading the crude oil market. This type of strategy will make it easier for the trader to follow the rules of their oil trading strategy because they already know that the strategy is profitable, therefore maintaining the discipline to continue following the oil system will be much easier.
Successful oil trading strategies will also include:
1. Oil money management guidelines
2.Oil Trading Psychology Mindset
These 2 will greatly improve the success of any crude oil trading system.
However, Let us look at crude oil price action strategy before explaining more about oil money management & oil trading psychology.
Counter Oil Trading Trend Strategies
Counter oil trend strategies are best used to place trades on major resistance and support areas where crude oil price is likely to reverse. These are the support and resistance levels where crude oil price has not broken before.
However, this strategy is not the most reliable oil trading method because trying to catch the crude oil market top or the crude oil market bottom is not the best strategy as the oil trend may continue to move in the original direction of the oil trend for quite some time.
This strategy should therefore only be used to trade oil that rarely oil trend. Oil traders can draw support and resistance levels of the crude oil price range and they will then use these levels to open trades - traders will open buy crude oil trades at the support level and traders will open sell crude oil trades at the resistance level. For a range bound market the oil prices will keep bouncing off these points and the traders will open trades and keep trading these crude oil price bounces.
Oil Trading Strategies Tips
Once a trader has come up with their oil trading strategy, they should also include the following in order to make their oil strategy more successful.
1.Oil Trading Money Management Rules
2.Oil Trading Psychology
Oil Trading Money Management Rules
Oil money management guide-lines should be part of your oil trading strategy - these rules will help you as a trader to manage risk. This means that you will use the two rules of oil trading money management - these are risk:reward ratio & draw down reducing method when placing your crude oil trades to determine lot size that you will open in the crude oil market. The most popular oil money management rule use in crude oil trading and one that you should also add to your trading plan is the rule that says a trader should never risk more than 2% of account balance on any one single oil trade.
To learn more about these two oil trading money management guidelines, traders should read the oil money management guide that's on the learn oil trading tutorials section of this website under the oil trading key concepts lessons.
Crude Oil Trading Psychology Mindset
In order to become successful when trading the crude oil market a trader has to learn about oil trading psychology. The oil trading psychology or mindset that's required to become successful in oil trading is one that avoids the emotions of fear & greed while trading the crude oil market & is a mindset of total discipline that a trader will follow all their rules & their oil trading strategy & only trade with trading signals that are generated by their oil strategy. With discipline a trader will not trade unless their oil trading strategy gives a trading signal. A trader will have the mindset of only following their trading system 100% all the time without second guessing the crude oil trading system. A disciplined trader will also not place trades in the crude oil market just because the crude oil market has started to move up or downward, instead a trader will wait for a signal to trade to be generated by their oil trading strategy.
In order to learn more about oil psychology and how to manage emotions while trading the online oil market a trader can read the oil trading psychology guides from the learn oil trading tutorials section of this website under the oil key concepts courses.
