Consistency is what sets winners and losers apart in the financial markets. The former understands strategies that ensure a desirable equilibrium between profits and losses every trading period. Fortunately, anyone desperate enough can be part of the exclusive group in both sideways and trending markets.
Uncover the secrets of consistent profit-making in the six expert tips shared below. Readers will find a groundbreaking indicator that elevates one’s trading experience in this article.
Table of Contents
1. Trade With the Trend
It’s a foregone conclusion. Trading with a well-defined trend (whenever it exists) is the most advisable practice for consistent profit-making.
Traders use several tools to identify these conditions, including trendlines and indicators like the Moving Average (MA).
It can also be more or less complex by combining multiple technical tools or barely inspecting the candlesticks for breaking of swing highs and lows.
When the uptrend is strong, hunt signals that support bullish entries. When the market is bearish, seek more ideas that support bearish positions.
The trend is truly your friend. Don’t believe otherwise.
2. Improve Risk Management Practices
Many trading experts believe risk & money management plays a more defining role in traders’ success than one’s analysis methods.
Compounding profits is easier with a solid risk management plan featuring better take-profit and stop-loss orders, improved risk-reward ratio strategy, and well-calculated position size.
If not, winning trades may never be sufficient to counteract the effects of losing ones in sideways or trending markets.
Anyone can enhance their risk management practice by researching online, taking new courses, discussing with colleagues, or learning from pros.
Enthusiasts develop new ideas, strategies, and tools continually. Thus, the study and improvement never stop.
3. Use a Trailing Stop Order
Trailing stop orders, one of the lesser-known money management tools, can also be indispensable for achieving consistent profits.
They are stop orders that adjust based on active positions when the market moves in one’s favor. The action helps to secure profits by capturing most of the trend while protecting your gains from a reversal.
For example, if a trailing stop is ten pips below the price, the order secures every profit made earlier than the level except during unfortunate slippages.
Almost every top trading platform today boasts this feature under various unique names.
4. Identify and Trade Within the Range
Despite having no trend, sideways markets move within a range, typically exploitable when defined.
Every range has upper and lower boundaries that will hold back prices from a bullish or bearish run.
Thus, employ the Relative Strength Index, Bollinger Bands, or less complex technical channels to highlight them.
After the determination, consider sell trades when the market is near a resistance and buy trades when near a support.
Profit targets can be at the support and resistance levels or midway between them.
Always be ready for possible price breakouts by tightening the stop-losses considerably.
5. Scale into Positions
Another noteworthy skill of pro traders is capitalizing on the underlying trend to maximize gains. Scaling into positions is one of the safest moves for this.
It entails opening more positions as the trend strengthens with increasing momentum.
Chartists can do this at any point within a trend using pullbacks in five unique ways, as discussed in another guide – Dominating 5 Profitable Pullback Trading Strategies for Optimal Returns.
As discussed, the trend must be strong enough before considering this. If not, the contrary consequences of this move can be seriously dire.
A strongly trending market has increased trading volume and minimal retracements.
6. Consider Lower Time Frames
Lower time-framed charts can magnify seemingly short price moves on higher ones. Hence, a ranging move in a sideways market may look trending in shorter periods.
Admittedly, it’s a big ask to temporarily abandon one’s swing trading model for day trading opportunities. However, this adaptation can be highly beneficial when the market has been ranging for too long.
Back- and forward-test it to perfection multiple times in simulated trading environments.
If it is too challenging with poor results, stick to other proven methods for trading consistency.
7. Achieving New Trading Milestones with Indicator Vault's Top-tier Invention
Unfortunately, several studies suggest the financial markets have more losers than winners. Consistent profit-making is easier said than done, especially for newbies.
However, Indicator Vault defies the odds with its groundbreaking discovery – Dynamic Bands for TV.
The technical tool blends the Dynamic Moving Average and Average True Range (ATR) to reveal promising opportunities in sideways markets.
It also features risk management suggestions from stop-loss to take-profit levels, bringing every user closer to automation.
Concisely, here are some benefits users enjoy from its application:
- Ability to trade profitably within a range for as long as possible
- Improved composure during market hours due to its near-automated nature
- Knowledge of the best risk management order levels per trade
- Freedom to explore any market or time frame desired
- Assurance of taking every promising opportunity, thanks to the system’s prompt alert feature
Ready to be part of this? Click here for an exclusive access now.
8. Conclusion
Consistent profitability in sideways and trending markets may pose a challenge. However, the following expert-proven hints work well to increase the chances of long-term success:
- Trade with the trend
- Improve risk management strategies
- Use trailing stop orders
- Identify and trade within the range
- Scale into positions
- Consider lower time frame trading
Anyone struggling to find their feet in the market should use Indicator Vault’s Dynamic Bands for TV. It combines several theories and technical tools for an automated trading solution.
Please share this article with more ambitious traders in every trading circle and leave feedback for engaging discussions below.
