Trading Strategy Consideration

Thing to consider when developing a trading strategy

1. Market condition
2. Asset condition
3. Entry condition/trading signal
4. Exit condition/signal
5. Volatility

Market condition

This is the general condition of the market, e.g. FTSE when you look at UK stock asset

1. Trending (up/down)
2. Ranging
3. Random

Asset condition

This is the condition of the asset itself, e.g. the stock or forex pair

Trading strategy type

Two types of trading strategy, which are suited for the different market condition.

1. Trend following
2. Mean reversion