What is confluence in trading?

Confluence refers to any circumstance where you see multiple trade signals lining up on your charts and telling you to take a trade. Usually these are technical indicators, though sometimes they may be price patterns. It all depends on what you use to plan your trades. A lot of traders fill their charts with dozens of indicators for this reason.

What is a confluence zone in forex trading?

This alignment of signals is often referred to as a confluence zone, and it’s where forex traders are more likely to make their moves. These zones offer a higher probability of success as they are backed by several indicators pointing towards a similar outcome, be it a rise or fall in price levels.

Why is confluence important in forex trading?

Otherwise, you will stack up time lag, which will only decrease accuracy. Confluence is beneficial because it does more than show you a good setup in isolation — it shows you a good setup in context of the market. This is essential in Forex to avoid fakeouts, unexpected reversals, and trading against the trend.