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In FX trading, learning to trade with the trend is one of the best ways to make money.
Fortunately, forex markets tend to have some of the strongest trends, offering a lot of opportunities for FX traders. It is, therefore, very important to learn how to find the trend in the forex markets.
Before looking at how to find the trend in forex trading, lets first of all talk about what forex trends are.
Why Do Trends Form?
The reason why trends form is simply because of an underlying supply-demand imbalance in the market.
With bullish trends, there is simply more buying pressure in the market than selling pressure, allowing price to continue to strengthen. The trend will continue until buying pressure fades and selling pressure builds, which brings the supply/demand balance back into equilibrium. This causes a contraction of momentum, leading either to a change in trend or causing the market to settle into a range.
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