What is EU 50 Trade Strategy? - Tutorial to Trading EU 50 Stock Index

The EU 50 Trade Chart

The EU 50 trade chart is displayed & illustrated and shown below. On the example below this financial instrument is named as EU50CASH. As a trader you want to find a broker that provides EU 50 trade chart so that you can begin to trade it. The example below is of EU 50 on MT4 Forex & Indices Trading Platform.

Strategy For Trading EU 50 Index

EU 50 is comprised of blue chip stocks choosen from best performing sectors in the Euro-Zone: therefore a good trade strategy to trade EU 50 is to trade long most of the times. This is because in general the best stocks in Europe will generally keep moving up and up because the companies behind these stocks are the best and most profitable companies in Europe.

The EU 50 is also revised every year so that if one stock is not doing well then it is replaced with another stock that is doing good. This ensures that most of the times EU 50 will keep going up.

As a trader you want to be biased & keep buying as the index moves upward. When European economies are doing well this upwards trend is more likely to be ruling. A good stock index trade strategy would be to buy dips.

During Economic Slow-Down & Recession

During economic slow-down & recession times, companies begin to report lower profits & lower business growth prospects. It is because to this reason that investors begin to sell stocks of companies reporting lower profits & therefore index tracking these particular stocks will also start to move downward.

Therefore, during these times index trends are likely to be moving downwards & as a trader you should also adjust your trading strategy accordingly to fit the prevailing downward trends of the stock market index that you're trading.

Contracts and Specifications

Margin Requirement Per 1 Lot - € 40

Value per 1 Pips - € 0.1

NB: Even though general trend is generally upward, as a trader you've to factor in daily market volatility, on some days the index might oscillate or even retrace, index market retracement may also be significant at times & therefore as a trader you need to time your entry precisely using this trade strategy: Indices trade strategy & at the same time use proper money management rules just in case of more unexpected volatility in the market trend. About stock index money management rules courses: What is index money management and index money management methods.