Defensive Strategy In Forex Trading

In a defensive strategy, you are letting the position of a transaction that is losing money without taking any action. This can be done if you have a large Equity because, in fact, no one can know how much and how long we will experience the potential for this loss. This strategy is based on the assumption that no matter how falling price moves, it will someday return to the price at which we take the position of the transaction. Never use this strategy if the money you have is very limited because a lot of traders who went bankrupt because of using this strategy. It is better if we accept defeat and try to take a new transaction position.

An example of this strategy is if we open a Buy JPY / USD position at 116.00 and when the current price is 115.00 we have floating loss of 100 pips but we do nothing and expect the price to return to position 116, 00 and even higher, so we get profit. You can visit our website and learn about complete currency trader tools strength indicator.