Forex Trading: Mechanic Approach In Trade
People who start to be engaged in commodity trade and forex trading, undoubtedly, have already succeeded in any other area. Without this success they couldn’t save up the capital necessary for trade. They assume to use the same rational approach to trade which has led to their previous success. Unfortunately, this in appearance reasonable methodology also leads to their crash.
The markets are organized so that money gets at many participants, and is allocated among several. Otherwise they can’t exist. Proceeding from it, it is obvious that it doesn’t work. Otherwise all would become rich.
The beginner believes that it can subdue the markets by means of very good analysis. It spends almost all time in search of effective methods of a prediction of the future direction of movement of the market. I trade since 1975 and I have spent many years for this useless employment. Believe me – the markets aren’t predicted – in sense of general understanding of this word. Fortunately it is not obligatory to predict the future market to gain money.
The professional is skilled enough to understand analysis restrictions. Though there is a repeating similarity in behavior of the market, however there is the sufficient uncertainty doing a prediction of the future by an impossible task. The professional knows importance of the consecutive approach to the market. It has a concrete plan of attack. He follows existing trends and doesn’t try to predict future trends.
Beginners believe that pros know, where the best possibilities. However actually professionals constantly notice that they don’t know beforehand what transaction will work. Often happens so that the least promise transaction makes the greatest profit.
Professional traders don’t have favorite time frame. Everyone finds prospect which approaches to its individuality. Some keep the position more than several minutes. Other traders can prefer day, average-urgent and long-urgent intervals. Everyone is inclined to adhere usual only to one time frame that seem to work better than others.
Each professional has a unique method to determine the potential transaction. It is included into the market when he dictates its trading plan. He follows a direction of movement of the market in time frame instead of foreseeing trend change.
All pros are ruthless at disposal of losing positions. You acquire leaving it is how much possible quickly from a losing position. A problem that the given approach pours out in big portion of small losses. The beginner wants, that losses were as less as possible as they for him symbolize only a defeat.
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