So, we have come to the final leg of the journey. In our last article on exotic currencies, we shall finish off by giving a few more useful strategies for this area. These are only a few brief words on the topics. It is up to you to later find out how these strategies work, and then explore which currencies to choose.
More trading strategies for exotic currencies
Unlike the previous trend trading, this has more focus on fundamentals. However, it is more of a balance between both technical and fundamental analysis.
Well, then, what is this sort of strategy all about? Well, the main idea is to properly figure out why currencies’ prices are where they are. So, while you do figure out what the exact price point of a currency is, you must know why as well. This can then aid you in figuring out when breakouts are going to occur. This is when the currency moves out of the current support or resistance. To put it in other words, it has moved past what people resume is the current price range.
To aid in this, one still needs to keep an eye out for chart patterns. Wedges, triangles, and pennants, could be signs of major change coming. However, there is no guarantee of this.
This is purer in terms of fundamental trading. One when both underappreciated and overappreciated currencies for this. They will then exploit areas that the market has not seen, beating them out handily. They thus find the peaks and troughs of a currency and ride it to where they think it should go.
Unlike the previous strategy, this usually means staying within the same range. This means they are not looking for it to go past the support or resistance level.