Forex Trading Price Action

Forex Trading Price Action

I have wasted a lot of time on things that do not work. I use to try different styles of trading charts and different type of indicators. My charts were stuffed with every tool that you could imagine. Did any of this chart oranament make me a better Forex trader? No! In someone way I believe that it actually held me back and slowed down my progress as a trader. The truth is that no one really needs all of those things on their chart to pick high probability trades. There is a much better way to found those trades.

A better way to find high probability set ups in Forex or any market is to learn how to read the price action. Price action is the story that creates what you see on the chart and it has to be viewed in real time. If you look back at an old chart, you will miss a lot of the story that the price fluctuations tell. When you simply spend months of time looking at how charts develop, you will be able to tell the ending of the story ahead of time. This is the beauty of understanding price action.

Price action will show you how the big banks and institutional traders develop intraday trades. You will be able to spot how they setup both novice traders and professional traders. There's nothing more magical when you start to be able to predict what is going on and what is going to happen because of the price action. I remember my first style spotting a fake out 10 minutes before it happened. I felt so accomplished and proud of myself. That was my first Yoda moment and far from my last. Give this a try and you will understand what I am talking about.

So is this magic and all I need to trade. Yes, you can develop your trading style all around price action but be warned that this is a form of discretionary trading. You will be making decisions off of subjection information and beliefs and if you lack the fundamentals of trading this can comeback to hurt you. The fundamental that you need to have are: Trading using a pre-planned system that you will not tinker with due to fear or greed. You have to have a money management strategy. If you understand these basics then trading Forex based on price action might be for you.

As you can see, the price is right! Price action tells the whole story of what has and will transpire in the Forex market. By observing price action, you will be able to accurately predict where the market is going, what the big money traders are trying to do and why a movement in price happened. Whereas technical indicators lag the market and are based off old data, watching price action focuses on the here and now, and on the only thing that matter when trading. What is that one thing, PRICE.

Forex Tips For Beginners

Forex Tips For Beginners

Are you thinking about getting started with Forex trading? There are a few things you should know before investing on the Forex market. Take a few minutes to review the following article for some useful information on Forex.

Do not spend anything on Forex until you have spent at least a few months educating yourself about trading. Becoming a successful trader takes many years of practice and you will eventually get there if you start by learning as much as possible about Forex. You could for instance read some books, watch some tutorials or talk to other traders.

Choose a broker you can count on. Some brokers have a bad reputation for a reason. You should also avoid brokers that were created very recently. It is best to choose a broker with several years of experience and an excellent reputation, even if they charge more. Do not hesitate to call different brokers so you can ask a few questions about the services offered or find out how much opening an account will cost you.

Choose a currency pair in function of the kind of trading schedule you want. Expect to make most of your transactions when both financial markets are open at the same time. For instance, traders who use the American Dollar and the British Pound can trade from 8 am to 11 am. Once you choose your currency pair, you will have to learn as much as possible about the two countries and their economy.

You should be comfortable with the technical and the fundamental analysis. Professional traders usually have a method they prefer but you should not specialize in one method or the other until you gain more experience. As a beginner, you can really benefit from mastering both approaches. Besides, there are situations where using both methods is the only way to make an accurate forecast. Read analysis written by professional traders instead of following your own forecasts. You can write down what you think will happen and compare your predictions to what happened at the end of your trading session.

The key to becoming a successful trader is to always assess your risks and minimize them. There are different methods you can use to minimize your risks, including going with the trend, never investing more than half of your available capital and using stop loss orders. Following the trend is your best option until you gain more experience with trading. Never investing more than half of your capital means you will be able to recover most of your losses in case one of your investments turns out to be a bad decision. Using stop loss orders means your investment will be sold once it reaches a certain value. This is a good way to stop your losses or to secure the profits you were expecting.

These Forex tips will help you become a successful trader but keep in mind that you will have to work hard. Start by learning as much as possible about Forex.