Are you losing grip with your trading? Feeling lost in your own analysis and getting angry at the markets because your trading is going nowhere?
You’re not alone.
Many other Forex traders suffer from ‘analysis paralysis’ due to excessively complicated trading strategies. The problem is, everything we learn in life teaches us how to survive in the workforce – and how to make it in the ‘real world’. Forex trading is a different world that you are not prepared for, and naturally we apply what we know from the workforce to the Forex markets.
FOREX TRADING REQUIRES A COMPLETELY DIFFERENT APPROACH – ONE OF MENTAL STRENGTH, ONE THAT REQUIRES YOU TO DISCIPLINE YOURSELF TO SICKENING LEVELS.
As you probably have already discovered – the two don’t mesh well together.
Forex trading requires a completely different approach – one of mental strength, one that requires you to discipline yourself to sickening levels. Sometimes ‘doing nothing’ is the most profitable approach – sounds counter intuitive right? Most things about the Forex market are. From my experience, most traders don’t find success until they ‘simplify’ their trading.
Today, I am going to show you a few easy steps you can take to really turn your trading around by ‘keeping Forex simple’.
Ditch all the Unnecessary ‘Extras’ from your Charts
It’s natural that you want to gain every single edge possible to turn the probabilities of success in your favour.
For a newbie trader, that generally means going out and hunting down all the ‘shiny new objects’ like flashing indicators, other charting tools, and anything that looks exotic enough to give you a ‘secret insight’ to the market that not many other people are privy to. Those who chase forex trading strategies which use indicators are generally unsatisfied with the performance the system provides in the longer term.
The natural inner workings of most Forex indicators cause them to respond very slowly to the organic market movements. The indicator may give up a buy or sell signal, only when the majority of the move is already over – getting you in at a very bad price. Indicators also suffer very badly in consolidating markets, generating a string of bad trade signals that can cause depressing drawdown.
Have a look at the stochastic – a popular forex indicator that comes packaged with most popular charting software.
The stochastic is only tailored to work during specific market conditions. Unfortunately, it doesn’t work well in trending markets – which are the prime conditions for making money. What the trader usually does next is seek out another indicator to ‘fix’ the problem, one that will ‘filter’ out the bad signals, and make the original indicator perform better. Despite the best of intentions – this only introduces more problems to the chart. Instead of making analysis easier, it makes it more frustrating – the two indicators will most likely give conflicting signals, and never line up in harmony to give a clear trade opportunity. The trader will then seek out more ‘chart aids’ to remedy this, but the situation gets out of control, and the chart template ends up looking like something out of a nuclear power plant control panel.