There are 4 myths that traders believe about Forex price movement which traders believe get them wiped out. If you want to make money at Forex trading, you need to know how prices really move and avoid the myths and that's what this article is all about.
Let's look at the myths in no particular order of importance; they're all important. Here they are:
You Can Predict Prices in Advance
Many traders think that prices can be predicted in advance but this is just hoping and guessing, there is no hidden order to price movement because if there was, we would all know the price in advance and there would be no market.
When trading Forex, you are playing the odds and that's it. This doesn't mean you can't win, you can but you must trade the reality of price change and cut your losses and run your profits.
Complex Mathematical Equations can Give You an Edge
There has been a massive rise in the number of cheap automated Forex software packages which claim they use mathematics, to help you make a regular income but they all lose money and the more complex a system is the more likely it is to fail.
Simple systems work best in an odds based market, as they have fewer elements to break. This is actually good news, as it means that anyone can achieve Forex trading success, so keep your Forex strategy simple and don't complicate your trading.
Markets Move to the Fundamentals
Markets don't move to the news, they move to what people think of the news and its a fact that markets always collapse when the news is most bullish and rally when its most bearish.
The facts are unimportant, its what people think of them that is and that's why the best way to trade Forex is to use Forex charts. The chartist doesn't care why prices are moving they just want to make money when they do and lock into trends.
How to Win at Forex Trading
If you want to win at Forex trading you can, because as we have just seen you only need a simple strategy and furthermore, its obvious that prices trend for long periods. So by locking into these trends, with a simple robust Forex trading strategy, anyone can achieve Forex trading success.
Let's look at the myths in no particular order of importance; they're all important. Here they are:
You Can Predict Prices in Advance
Many traders think that prices can be predicted in advance but this is just hoping and guessing, there is no hidden order to price movement because if there was, we would all know the price in advance and there would be no market.
When trading Forex, you are playing the odds and that's it. This doesn't mean you can't win, you can but you must trade the reality of price change and cut your losses and run your profits.
Complex Mathematical Equations can Give You an Edge
There has been a massive rise in the number of cheap automated Forex software packages which claim they use mathematics, to help you make a regular income but they all lose money and the more complex a system is the more likely it is to fail.
Simple systems work best in an odds based market, as they have fewer elements to break. This is actually good news, as it means that anyone can achieve Forex trading success, so keep your Forex strategy simple and don't complicate your trading.
Markets Move to the Fundamentals
Markets don't move to the news, they move to what people think of the news and its a fact that markets always collapse when the news is most bullish and rally when its most bearish.
The facts are unimportant, its what people think of them that is and that's why the best way to trade Forex is to use Forex charts. The chartist doesn't care why prices are moving they just want to make money when they do and lock into trends.
How to Win at Forex Trading
If you want to win at Forex trading you can, because as we have just seen you only need a simple strategy and furthermore, its obvious that prices trend for long periods. So by locking into these trends, with a simple robust Forex trading strategy, anyone can achieve Forex trading success.
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