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What is the FTC setup in price action? A method for trading and counter-trend.

You have probably heard many times that a professional trader in financial markets should always trade in the direction of the trend. Trading experts say that ‘the trend is your friend.’ But the truth is that the trend is only your friend until it ends. In addition to the method of trading in the direction of the trend, you can also use counter-trend trading methods; however, you should be aware that this style of trading carries more risk and requires a complete understanding of trading psychology. One of the trading setups that you can use for counter-trend trading is the FTC trading setups. In this article from the X-Chief Academy, we will examine this method along with examples, so stay with us.

Types of trading in Forex based on trends

Types of trading based on technical analysis can be divided into the following two main categories:

• trend trading
• counter-trend trading

Most trading styles are created and developed based on trading in the direction of the trend; because these types of strategies have a higher win rate and from a psychological perspective, trading with such styles is easier. However, since trend trading has a low risk-to-reward ratio Some professional traders who have a strong mastery over their emotions prefer to trade against the trend. They try to enter trades in the opposite direction by finding the turning point of the trend and engage in high-risk trades. It’s important to note that this trading style has a low win rate and It is not suitable for everyone; because consecutive losses in the market may take you out of your normal state and cause you to take on big risks to recover your losses.

In general, it is recommended that at the beginning of your trading activity, use trend-following strategies, and only turn to counter-trend strategies when you have gained a high level of experience and skill in trading.