Today I want to talk about reverse trading because it is something that could turn you from a losing trader into a profitable trader. It is based on the notion that most forex trading systems lose money, so instead of taking the signals that are offered, you actually enter trades in the opposite direction instead.

So for example if you have created a system that is based on going short when the RSI reaches the 70 level on a certain time frame, then you may well be able to make money if you have the right stop loss and target price levels because a system this simple doesn't tend to be profitable in the long run.

Similarly you could try and come up with a day trading system based on the 1 minute or the 5 minute charts for instance, because this is arguably the hardest way to make money. Then once you have found that this system is not profitable, you can reverse trade each of the set-ups to capitalise on this unprofitable system.

People often joke on forums that if you want to make money from forex trading, simply place trades in the opposite direction as them. However this kind of strategy could have some merit.

If you are a member of the ZuluTrade website, for example, where you can trade the signals of thousands of different signal providers completely free of charge, you will find that reverse trading can be done here as well.

Not all of the signal providers on this site are profitable. In fact some are completely useless. However they offer a facility whereby you can reverse trade the signals of whichever providers you want. So you can potentially make money just by finding the worst traders on this site and auto-trading their signals in your trading account.

I have to admit I haven't yet done this myself, and I probably won't do this in the near future either because I have a few profitable strategies of my own. However I do know that over the years I would say that at least 99% of the systems I have tested are not profitable in the long run. So there is surely to be money to be made by reverse trading some of these systems.