Special: Save 40% Off Nial Fuller's Trading Course & Trade Setups Newsletter (Ends September 30th) -
Nial Fuller

NIAL FULLER
Professional Trader, Author & Trading Coach

How To Develop A Forex Trading Plan & Trading With Confluence

2011-09-10T00:00:00+00:00
author thumb
By in Forex Trading Videos Last updated on | 11 Comments

How to Develop a Forex trading plan  –  Trading Confluence; one of the most effective methods to trade forex with high probability.

Video Synopsis -How to develop a forex trading plan – trading confluence 5-29-2009

In the above forex education video I introduce traders to the concept of forex trading using confluence.

Confluence is simply an area where two factors meet and confirm one another; it’s the “weight of evidence” argument. Confluence = an area on a chart where 2 or more trading signals come together at a common point.

When we have a horizontal line on a chart and an uptrend line or a moving average, and the two meet at the same point, this would be an example of confluence.

The beautiful thing is when we are trading we can put into our trading plan conditions that must be met for confluence. Condition 1, do we have confluence of two factors to support the direction we are trading? An example of this would be a moving average cross over to the upside and an uptrend line that aligns at the same point as a moving average, if we then buy a pullback, or go long on weakness in the uptrend at this intersection point of signals, we are then trading at confluence.

A practical example from the video above: Crossover of moving averages to the upside = momentum to upside, also look at the horizontal line, the area where the horizontal line and MA meet is confluence. The 3rd variable is the price action confirmation signal, in his video the price action signal was a pin bar. This is called 3 variable confluence and it’s a very high probability way to trade the forex market.

Entering at “confluence” is the most important factor of any forex trading strategy.

About Nial Fuller

is a Professional Trader & Author who is considered ‘The Authority’ on Price Action Trading. He has a monthly readership of 250,000+ traders and has taught 20,000+ students since 2008. Checkout Nial's Professional Forex Course here.
  1. rajesh vishwakarma September 4, 2014 at 4:09 pm

    Nice video on good feedback as well..thanks

    Reply
  2. pitborirak August 24, 2014 at 7:22 pm

    very good, clear, and understanding.

    Reply
  3. Sheila May 11, 2012 at 7:52 pm

    Great video Nial, thanks for sharing your abundant knowledge.

    Reply
  4. Ellis Russell January 23, 2012 at 3:41 am

    This is awesome!

    Reply
  5. George November 30, 2011 at 5:42 pm

    Thanks Nial.

    Reply
  6. Larry Hoover October 23, 2011 at 9:42 am

    Hi Nial,

    Given the importance of Confuluence could you provide us with more details (videos or written materials) on same?
    THX Larry

    Reply
  7. bob morley May 30, 2009 at 11:43 pm

    I know you are pro-price action and I am learning to think that way as well. I fully believe that price can do anything it wants WITHOUT the permission of RSI or Stoch or CCI etc.

    BUT

    Don’t you think Ichimoku has many of these confluences built in? I have been putting a lot of weight on where price is in relation to the cloud for a filter and trying to trade only with price action in that direction. Price action rather than line crosses being my trigger.

    Reply
    • nial May 30, 2009 at 11:46 pm

      I like the idea of confluence in any trading method, its the simply the idea of using multiple reasons to enter a trade which align together to give one common trading signal.

      Reply
  8. anand devkota May 29, 2009 at 11:39 pm

    Thank you sir

    Reply
  9. tom power May 29, 2009 at 10:27 pm

    however what is frightening about this point is that there was a doji (narrow range open=close) bar after an uptrend a sure reversal yet it pulled back and kept going

    Reply
    • nial May 29, 2009 at 11:12 pm

      You have traditional candlestick patterns confused with my methods. This is not a doji in my eyes, its a pin bar bullish reversal. Lower prices where clearly rejected. A doji is not valid if it forms in this vecinity of the chart anyway.
      Please check out my course for more clarification.

      Reply

Leave a Comment

Your email address will not be published. Required fields are marked *