An arrangement of analyses that a forex trader uses to decide if to buy or sell a currency pair at any given time. Forex Trading strategies can be based on many things. It appears forex market is expanding day by day and with this new sort of systems or methods going along. To do here currency trading would it be advisable for me to must be analyzer of each term? How to survive here in this way? How other forex trader doing this?
Same simple rule applies to forex trading or any enterprise or project you’re thinking of running.
The goal is to be good at the game, not to know everything about the game. So work out what questions you need answers to before you start looking for the answers.
e.g. Amongst traders, there are successful traders who just look for 1 or 2 chart patterns and they only trade these. They don’t need to know much about the other 100.
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Even from my limited experience, I know enough to understand that this is both right and important.
Most people get it all wrong because they do it the other way round. They start by taking in as much information as possible, without first knowing “what they need to learn” and without even being to tell information from misinformation, and without understanding how much widely repeated misinformation there is online. There’s a lot!
You just need to be able to do a few simple things with total reliability and persistence. It doesn’t matter if you ignore 95% of the available information, if you can make a profit by using the other 5% reliably and persistently enough.
I think a trader needs to have more than just one method of trading that they feel comfortable with, but it’s easier to get started by just picking one method. As other posters have said, the key is profitability. I think there is a second key as well: don’t get lost in the weeds. By that, I mean filter out everything except what you need to focus on at that precise moment.
If there are 1 million traders, then there are 5 million ways to trade. You probably heard this 1,000 times before, but pick a method that you feel comfortable with. For example, I like to have very clear entry signals for when I should be in a trade, so pure price action trading methods won’t work for me. Instead, I would be better off trading basic reversal patterns such as double tops and bottoms, or head and shoulders.
Good luck!
no, you just need to analyze whatever you need to analyze to find your edge and to be consistent
but that means you need to learn a lot, to work out what you do need to analyze to do those 2 things
there’s no profit without those 2 things
There’s a lot to be said for double tops and double bottoms - definite entry points with good stop loss positioning. Not too sure about head and shoulders personally, I never see them until After they are formed and they can be a lot lop-sided.
I’m paper trading a double bottom on the EurUsd as I type. Entry too early at 1.1725 last thursday, with stop loss 1.1649 target 1.2000.
@anon38711221, I am really doing hard work to establish my career as a good and successful forex trader. I am learning continuously. But sometimes I feel really bored and exhausted. And it seems like earning money is not easy anywhere. Most of people’s said and still saying that making money in forex is easy. But I can now understand. They are all wrong actually.
Making money in Forex “consistently” is not easy at all, that is why most people fail. Most people lack the discipline and psychological fortitude needed to learn the process and suffer repeated losses, and realize that this is part of the deal with Forex. There will always be losses. The key is learning to take the trades that have the highest statistical probability of success. How do you learn that? That’s where people differ in their opinions. For me, the answer was price action. Learning to read a chart like it’s my language and it’s telling me what it is likely to do next. And learning to identify key patterns and price behavior at certain levels. All of this combined gives me my advantage. That and years of practice - and yes, failure. I can finally say that I am winning more than losing and I think that I know what the Hell I am talking about. But was it easy to get to this point? NO.
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[quote=“Estaben, post:1, topic:116545, full:true”]
An arrangement of analyses that a forex trader uses to decide if to buy or sell a currency pair at any given time. Forex Trading strategies can be based on many things. It appears forex market is expanding day by day and with this new sort of systems or methods going along. To do here currency trading would it be advisable for me to must be analyzer of each term? How to survive here in this way? How other forex trader doing this? [/quote]
Trading is not just a question of deciding market direction. There are many basic parameters that one should set regardless of the method or system, used, for example:
- are you looking to make a regular income from trading or capital building (or both)?
- what markets are you going to concentrate on?
- what time horizons suit your circumstances and plans?
- how much captital are you putting into your trading?
- are you looking to trade manually or via an EA?
- are you going to base your trading decisions on technical analysis or fundamentals or some kind of mixture?
Once you have clarified and settled these kinds of issues then you need to form your trading plan that meets these criteria. This plan will include your rules for trade entries and exits. But one of the most important components of your trading plan will be your risk/money management rules.
Trading is based on taking positions that expose you to risk. You need to know how much risk you are prepared to take on each position - both in absolute terms and relative to your profit targets and your equity level.
But whether each individual trade wins or loses is not relevant (except for analysis purposes). It is your overall performance that counts. If you have a method that generally produces 50% wins and 50% losses and your risk/reward parameter is approx 1:2 then you will still make a net profit over time.
This is one reason why the claim, “you never go broke by taking a profit”, is misleading and even dangerous. If one continually only focuses on one trade and takes a profit simply because it is in the “green” then this will distort your overall risk/reward parameters in the longer termand will soon be wiped out by a bigger losses.
Personally, I think that these risk/equity control issues are far more important that just getting a good entry.
Regarding losses, these are an integral and intrinsic part of the nature of trading as a business. It is like:
" looks like it will do this - Yes! so let’s stick with it / No! lets get out quick!"
Losses are normal but it is always important to analyse them:
- was it in line with my trading method and parameters? Yes - acceptable loss / No - bad loss.
We all have bad losses from time to time due to lapses in concentration, spontaneous whims, influence from other people and so on -we need the discipline to cut these out.
Trading is a business, and like other businesses it has its own rules and parameters.
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