The house has all of the money and knows and makes the rules. The thing about the rules is that they seem random as if they are being made up as we are going along. That is why the proper interpretation of the language of the charts is so essential to your trading success. Your indicators and oscillators are only following where the price lead. How much better is it to be able to interpret what is going on in the market long before your indicator does? It can be done and is done skillfully everyday by people who understand and know the language the charts speak.What is this secret, strange, mysterious, language that the charts speak???
PRICE ACTION!!!!!!!! What price is doing and has done, along with the natural rhythm of the market.
By the time your indicators tell you what your price is doing, you are already behind those who interpreted price action long before your indicator/oscillator clued you in. Have you ever waited for your indicator/oscillator to tell you to get in only to discover that you have missed a great deal of the move already. Becoming fluent in the language of price will help you to avoid much of that.
THERE IS NO PERFECT FOREX SYSTEM, it doesn't exist,but studying and learning the language of your charts will put the odds in your favor, and help you to glean a sweet little profit in the process.
There are no short cuts here. You can learn the language and get an advantage, or you can rely on the news, support/resistance, trend lines or other indicators/oscillators. I am a huge fan of support/resistance and trend lines, but gaining an understanding of price action will give you a clear advantage.
I am not bashing indicators, but you need to understand what they are. They are merely assistants and interns to the PRESIDENT OF PRICE ACTION.
Is PRICE ACTION ENOUGH??????
NO!!!!!!!
Like the president, your Price action needs a cabinet that can support it. That is where your indicators and oscillators come on. They are your support staff. Once you master PRICE ACTION, the other things become natural assistants.
Price action will not tell you everything, it will not tell you how far price is headed, and how long the destination might be. That is where support/resistance, and long term trend line comes in.
At the end of the month, always see where your price is headed, then plan your strategy accordingly, knowing that most of the time you will have a bounce on your weekly candle. DO NOT SHORT OFF OF THE LOW OF THAT LAST MONTHLY CANDLE, BECAUSE MOST OF THE TIME, YOU WILL END UP ON THE WRONG SIDE OF THE TRADE.
THAT IS WHY LEARNING YOUR MARKET RHYTHM IS SO IMPORTANT!!!
PRICE ACTION ALONG WITH FRIENDS CAN TAKE YOU WHERE YOU WANT TO BE.
You may use any indicator/oscillator that your are comfortable with. Just remember that they are the cabinet to the PRESIDENT OF PRICE ACTION!!!!!!!!!!!
Trading is based on our hypothesis. In other words trading amounts to our educated guesses, which means the more you invest in your education, the more likely you are to find yourself on the right side of the trade. One of the most widely overlooked parts of trading education by traders is the study of past charts. I make personal videos, so that like a football team I can review my plays and create better strategies.
Your chart will tell you almost every thing you need to know to get on the right side of the trade. The one thing it doesn't tell you is what is going on behind the scenes and it will even give you a hint to that most of the time. Your bullish/bearish ENGULFING patterns are evidence that there are some secrets that the market keeps to itself.
Mastering your candlestick psychology, your support/resistance, and your trendlines are things that you want to major on and learn well. You may not win every trade, but having a firm foundation on these simple techniques can greatly increase your odds of a successful trade. I think the more simple your charts, the better and easier it is for you to enter a good trade.
Sometimes you will have the perfect trade set up and all of your analysis will be right and you will find yourself on the wrong side of the trade. No big deal, it happens to all of us, review that trade and see if you can identify the error. When you have reviewed it, look for the next trading opportunity. There is NO PERFECT TRADING STRATEGY!!!!!!! This is only a guessing game for those of us who like to play the odds. The better your education, the better your odds will be against the house.
My Friends, I am always honored to have you along. I am going to post some strategic videos here that you can book mark so that you can review them from time to time. Keep in mind that every market day is different. Your candlesticks are always telling a story. Look at the past story of the candles to help accurately interpret what your candles are telling you right now.
ALWAYS WAIT FOR PROPER TRADE SET-UPS. Great trading is mostly waiting to meet with great profit opportunity. No truly great trader is in the market all of the time. A truly great trader waits to pounce when she/he sees profit ripe on the horizon. However, I know some scalpers that make more than 200pips a day, but they wait for proper trade set-ups.
You have to choose the trading style that fits your personality, as there are many ways to successfully trade forex and no one has the monopoly on great trading. We have just found what works for us successfully. When you find good stuff, learn what you can, then tweak it to make it your own. Forex is a consistent building of knowledge.
Most traders are under the illusion that their greatest opponent in the market are the skilled pros out there who are waiting to gobble them up. While they are worthy opponents, there is an opponent even more worthy, if you go to the mirror, you will find them. The biggest enemy to trading successfully is YOU and your mindset.
The thing that usually demolishes traders besides getting into the game way too early (while they are still very, very green) is their lack of discipline and patience. The hardest thing in the market, especially if you are a natural Type A personality, is the waiting.
The natural type A makes the perfect forex victim, because we like to see things move and like to get things accomplished. While this is a very desirable trait in most other aspects of life, it can be to your determent in forex.
It is the incredible volatility and fast pace of forex that attracts us in the first place, but when the market is stagnant, it can make us nuts, often causing us to make premature ill-timed entries.
That is why it is essential to your long term success for you to perfect your WAIT!!!!!
What are you waiting???
For proper trade set-ups!
Trades in harmony with your trend will usually be the most profitable and give the most reliable signals.
LEARN YOUR CANDLESTICK PATTERNS!
LEARN YOUR TRENDS!!!
LEARN YOUR SUPPORT/RESISTANCE!!!!!
LEARN ABOUT MARKET RHYTHM!!!
LEARN MARKET PSYCHOLOGY!!!!!
AFTER LEARNING ALL OF THAT.
YOU MUST PERFECT THE ART OF WAITING !!!!!!!! (^_^)
When you take a hit, you have got to think your way through it logically.
Questions to ask yourself when you have taken a hit. What is the lesson here???
What did I learn????
How can I avoid this next time????
What is my strategy the next time I encounter this situation????
Did I remember to pat myself on the back for the good trades this month?????
Did I remind myself that I have had many more successes this month??????
Did I remind myself that this is just an opportunity to do it better next time?????
Did I use proper discipline????????
Did I wait for a proper trade set-up??????
Did I follow my trading rules????????
How long am I going to wallow here???????
Did I remind myself that the market is very generous and will always give me plenty of opportunities for profit???????
Do I have more money now than I did at the beginning of the month????
If YES, you are ok. You are out to win the war, though you may lose a few battles. If you have gained 90 dollars for the month and you lose $8, then you are ahead of the game by $82.
If the answer is NO and you are consistently taking hits, then STOP and RETHINK your strategy, There is something WRONG!
No one can tell you how to trade; all they can do is share their experience and you will have to tweak it to fit your trading style. Thinking through your losses logically will give you the best advantage over reacting emotionally . NEVER EVER USE A LOSS AS AN OPPORTUNITY TO BEAT YOURSELF UP. IT IS AN OPPORTUNITY TO GAIN AND INCREASE YOUR KNOWLEDGE
There are times when the market is murky, cloudy and choppy, but there are the sweet times when the market is crystal clear like a cool refreshing spring. That is when you want to be in it. Many traders try to swim in all market waters. This is a big mistakes. Dirty waters are full of sharks.
IF YOU DON'T CLEARLY SEE AN ADVANTAGE; DO NOT TRADE!!!!!
IF YOU CAN NOT SEE A TRADE SET-UP, IT IS PROBABLY BECAUSE THERE IS NOT ONE.
You may wait a whole day for a market set-up, never to get one. That is when traders get antsy and agitated and begin creating trades from thin air. Mostly ending up on the wrong side of the trade. WHY gamble with your capital like that?????????? THAT IS DUMB.
When the market is lost, let it wander, but you stay out. It is hard, I know, as all of your emotions are screaming at you not to miss out. Miss out on what??????
What you are missing out on is the set-up for the BIG KILL. SOMETIMES THERE IS NO TRADE and if you are wise, you except that and go find some other way to occupy your time. If you are no a pro, don't play the out-smart-the-market game, it will make road kill out of you fast. You may get away with it a time or two, but you can be sure that eventually it will catch up with you, because market strategies don't stay the same. It only takes that one 200-400 pip shake out day to change your world for the worst.
Trade when your trades are more predictable than not. Trade when the waters are cool, refreshing and crystal clear. Trade when the market is sending you a VERY CLEAR invitaion to jump in. If the water is murky, you can believe there are sharks. SWIM AT YOUR OWN RISK !!!!
The hardest thing to master as a trader once you understand Market Rhythm is not the market, it is YOU. Emotional trading will break you fast.
Trading is not hard, it is mastering your emotions that is. Trading will teach you more about your human short coming than visiting a psychiatrist. As a trader, you must learn the discipline of waiting for proper market set-ups. That is hard!
Your EMOTIONS are screaming for you to jump in or you will miss out. NOT TRUE!! If you miss one trade set-up, the market is generous and will give you another. Learn to trade in harmony with your trend and with proper signals.
The emotions that are deadly to your trading success.
REVENGE, we all know it and have done it. It happens when you are tricked by the market and decide to take another trade before looking at the big picture, then BAM you are on the wrong side of the trade again. Pissed off and refusing to move while your money is going further down the drain. Scared to let go for fear that you are going to get tricked again.
PANIC, that is when you lack the confidence to enter or ride a profitable trade. This happens when you have taken some hits and now you lack the confidence to trade profitably.
IMPATIENCE, this happens when you can't wait for a proper trade set-up and jump on a price hiccup/retracement, often finding yourself on the wrong side of the trade.
ANGER, you know that feeling that comes over you when you have taken a hit or two and you want to kill your computer.
SELF PITY, when you come to the market hoping for crumbs and get none, and can't see why THEY won't let you have just a little bit.
DEPRESSION, something perhaps outside of the market has you at an extreme low point.
INDIFFERENCE, it happens when you have gotten hit so many times that you just don't care any more because no matter what you can't win any way.
All of these emotions work hard against you clouding your clarity and give other traders the advantage over you.
If you are experiencing any of these emotions when you enter your platform; abandon your trading until you have yourself under control and have the clarity of mind to trade. Not doing so greatly increases your chances of handing your money over to a trader who is more emotionally fit and controlled than you are.
We are all human and it happens to us all, but what weighs heavy in your mind will often weigh heavily in your pocket.
Come to your trading platform, well rested, focused and ready to trade. You may take an occasional hit; SO WHAT it is a LESSON. We all get them and if we learn the lesson that the loss has taught us; it will make us much better traders.
