If you are just getting started in Forex trading or if you are a struggling trader who has been around a while, it will do you a world of good to simplify your trading strategy. Trading the market is not really a difficult task in and of itself. What is difficult is managing your emotions and remaining calm and objective enough to make the best trading decisions. Indeed, this is where most traders screw up and is why most of them lose money; because they can’t manage their emotions effectively. Part of managing your emotions effectively is having a trading strategy or system that is simple to understand and implement but that is also effective. Many traders try to trade with a plethora of lagging indicators all over their charts, this just works to confuse them and puts them in a state of constant over-analysis and temptation (to trade).
If you really boil down any market to its core, you will find that the raw price action of the chart actually shows you everything that is happening in that market. What I mean is that if you just learn to analyze and trade the market based solely on its price movement, you are trading the end result of all variables that affect a market. Everything that happens in the world that affects a market’s price is ultimately represented on a market’s chart via price action. Thus, through price action trading, a trader can make accurate trading decisions that are not influenced by any secondary analysis tools like indicators or trading “robots”.
It is the clarity and simplicity of trading with price action that allows a trader to trade any market condition, whether it’s trending or consolidating, and this flexibility of method is very important. Many “robot” trading systems or rule-based indicator methods are only applicable in one market condition, and they will generally lose effectiveness over time as the market structure changes. One thing you can be sure about as you trade with forex price action trading strategies is that you will always be able to read and trade the market no matter what condition it is in or what the structure of the market looks like. Now, that’s not to say there will be a valid trade setup everyday that’s worth risking your money on. But, if you are patient and learn to master price action strategies, you will likely never go more than a few days without getting a high-probability setup to trade.
The best way to get started with trading price action is to learn from an experienced price action trader. The insight and wisdom they possess will greatly shorten your learning curve and will give you the potential to avoid many of the beginning trading mistakes that most traders make. So, if you want to simplify your Forex trading and forge a calm and collected trading mindset as a result; consider learning to trade with price action trading strategies.
Nial Fuller is a Respected Trader and Forex Coach. He Runs a Forex Training and Education Website, Visit his site here: price action