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WHAT IS CONFLUENCE IN FOREX TRADING?

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WHAT IS CONFLUENCE IN FOREX TRADING?

Post by asiaforexmentor on Tue Jan 10, 2012 3:39 am

What is CONFLUENCE in Forex Trading?

Alot of people have this question in mind on what is confluence in forex trading.
And why is it so important.
Lets start with the Forex Market.
It is made up of traders (Big or Small) to determine the flow of the market.
For example: if there are more people buying the Bulls than the bears at a period of time. The market will most likely go Bullish. And so forth if it goes bearish.
Therefore, forex trading is about understanding the market sentiments. “Where is the big guys with the big influx of money moving the currency market to?”
And this leads to CONFLUENCE.
For example.
Forex Trader A trades only on Fibonacci signals
Forex Trader B trades only on Moving Average signals
Forex Trader C trades only on Support & Resistance
Forex Trader D trades only on Price action
Forex Trader E trades only on News
Forex Trader F trades only on Divergence
Forex Trader G trades on other indicator signals
Example: Forex Trader A sees a fibonacci signal which is strong and he enters it long. But Forex trader B & C sees their signal and took it short. The market will most likely head short if there are more traders who took it short than long. The bears won the game.
From this example, you can see why Confluence is so important in forex trading and why professional forex traders enter only on confluence.
When we combine all the signals, and if they come together in the same direction. Then there is a very good chance that the market will move your way. Because all the forex traders sees their signal (eg. long) and entered it. Regardless of which signals you see, it shows short.
This shows that, the more trading signals you get on your side of the trade, the higher the chance of winning.
Of course we need not wait until all the above forex signals come together. So long as we have 3-5 signals that comes together. We have gotten ourself a good trade. And if you take these kind of trades continuously, your forex account size is sure to grow.
Remember you heard this First from Asia Forex Mentor, and at our Price Action Course – We teach the full forex trading system and strategies for you to apply in your live forex trading account.
It is Not only about Confluence but is also about how to be a CONSISTENTLY PROFITABLE forex trader.
To an awesome trading as always,
Ezekiel Chew flower from www.asiaforexmentor.com
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Re: WHAT IS CONFLUENCE IN FOREX TRADING?

Post by olixlite on Mon Jun 16, 2014 10:00 am

Confluence in trading is one of the simplest yet greatest and effective way of getting resources from any market across the globe. Confluence in forex has to do with a situation whereby the market is determine by the quantity of availability of big [bullish] or small [bearish] traders in the market . If there is more bullish traders at a certain time the market will go bullish but if the bearish traders are more the market goes bearish. For example if large number of traders are watching AUDUSD and enough traders will sell under the premise that resistance may come in ,that can change the supply and demand in the market and create a reversal in the price . More buying and selling means the price will go up.

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