Price Action: Learn The Right Way To Trade
It appears to me that every time a new trader wants to learn about what it takes to trade the forex marker, they will usually spend all their time scouring the internet to and learn about using indicators like stochastics, MACD, moving averages as well as the other common ones.
After they find out about these indicators, they absolutely flood their charts with all these lagging tools. The sad thing is that it never dawns on traders that they should be learning about price action, when it comes to trading the forex market. I believe this has to do with the fact, that many traders think its impossible to tell which direction the market is headed without having to use these generic indicators. They truly dont know which way the market is going.
What most people dont realize is the fact that when you trade with indicators, you are essentially trading other peoples signals. All you are doing is hoping that they are giving you correct information, because YOU truly dont have any idea of why you are taking a trade. You are essentially going on blind faith.
But the whole idea of trading forex by just using price action is that you get to eliminate all the clutter that is on your screen. By doing this, you get a clean and unbiased look at how the market actually moves.
I think one of the things that many traders have to struggle with is the fact that when you use indicators, sometimes you are left with two separate indicators giving you opposing signals. For instance, one indicator will tell you to buy, while the other one will tell you to short.
With so many traders not really grasping what price action is all about, they are held hostage with these indicators, as they have to wait for them to match in the same trading direction.
Im sure you have an idea of what a tough spot this is for a trader to be in. Think about it. Instead of being proactive in the market, you are left staring at a bunch of random lines hoping that they match in the same direction. The really sad thing is that most traders dont even understand what exactly these lines represent.
The next time you catch yourself doing this, I want you to think about the New York Stock Exhange Floor, and think about all the floor traders out there who make a lot of money trading by not even using trading charts, much less using indicators. - 23305
After they find out about these indicators, they absolutely flood their charts with all these lagging tools. The sad thing is that it never dawns on traders that they should be learning about price action, when it comes to trading the forex market. I believe this has to do with the fact, that many traders think its impossible to tell which direction the market is headed without having to use these generic indicators. They truly dont know which way the market is going.
What most people dont realize is the fact that when you trade with indicators, you are essentially trading other peoples signals. All you are doing is hoping that they are giving you correct information, because YOU truly dont have any idea of why you are taking a trade. You are essentially going on blind faith.
But the whole idea of trading forex by just using price action is that you get to eliminate all the clutter that is on your screen. By doing this, you get a clean and unbiased look at how the market actually moves.
I think one of the things that many traders have to struggle with is the fact that when you use indicators, sometimes you are left with two separate indicators giving you opposing signals. For instance, one indicator will tell you to buy, while the other one will tell you to short.
With so many traders not really grasping what price action is all about, they are held hostage with these indicators, as they have to wait for them to match in the same trading direction.
Im sure you have an idea of what a tough spot this is for a trader to be in. Think about it. Instead of being proactive in the market, you are left staring at a bunch of random lines hoping that they match in the same direction. The really sad thing is that most traders dont even understand what exactly these lines represent.
The next time you catch yourself doing this, I want you to think about the New York Stock Exhange Floor, and think about all the floor traders out there who make a lot of money trading by not even using trading charts, much less using indicators. - 23305
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To learn more about learning price action, make sure to check out forex millionaires.
posted by Mr. Forex at
5:11 AM
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