Research And Application Of Forex Trading Strategy Based On Trend Analysis

Firstly,this paper optimizes the trend definition of Dow's theory,and studies the settings of stop loss point of trend trading in foreign exchange market by using trend definition.By comparing with the moving average,this paper puts forward the breakthrough trading method and the edge short-making method,and gives a clear entry signal,which improves the disadvantage that Dow's theory can not guide specific transactions.Then,guided by the trend trading idea of homeopathy,a foreign exchange trading strategy is constructed,and the EUR/USD with the largest volume and the strongest liquidity is selected as the case study object.Under the strict risk control conditions,the historical return of the foreign exchange trading strategy is predicted using the H1 cycle price data from 2010 to 2018,and the final return on investment of 1 924.97% and 39.69 are obtained.% The annual compound rate of return verifies the feasibility of this foreign exchange trading strategy.This study shows that there is a trend movement in the foreign exchange market;the trend analysis is effective and can achieve returns;the entry signal given by the moving average has a lag.