Does stocks and forex have similar set-ups? I’m reading Al Brooks’ Trading Price Range and I’m worried since he mostly mentions stocks that I wouldn’t really be able to use it.
He says that the markets are made of human behavior so essentially they’re all the same, but I don’t know if that’s just his pitch for him to sell the book to a larger audience. Windows, for example, is something I don’t see in forex, but in his book it shows price gaps all the time.
No, that is not quite how it works. True that there are many similiarities when you analyze an asset. Technical analysis for example is the same (chart patterns, indicators etc), but you need to familiarize yourself with each asset. I do trade both and while knowing one will decrease your learning curve drastically you need to make some adjustments in your strategy.
You won’t see many gaps (windows?) on a forex price chart. In the daily timeframe, session divisions are arbitrary, and one begins immediately that another ends; in intraday timeframes the liquidity is such that there are seldom prices at which no counterparty can be found, meaning that there are seldom intraday gaps.
The idea that there are “setups” is a little unhelpful - can you imagine currency traders at a hedgefund saying to one another “hey, I heard about this great new setup”?
Can you drive a car well? Probably. What “setups” are there in your driving? None - driving well is a complex and dynamic process in which underlying similarities of circumstance are masked by plethora of changing contextual information - you process all this successfully and you drive well. You don’t get in the car and wait for a “setup”.
I hope that doesn’t sound harsh or disparaging - I’m just trying to suggest that you to approach the markets (whether stocks or forex) with a more fluid and open expectation of how to profit from them.