Financial News Hub

It seems that most forex traders now are looking for the short cut, instead of using the oldest form of technical analysis: trading just using price action. Most traders though don’t seem to be interested.

You can tell this is true by looking at any forex forum on the internet. What is it that you normally see on these sites? Usually it’s people that are talking about some system that has 40 moving averages or some forex expert advisor that’s supposed to be the new holy grail.

Can you tell what’s wrong with all of this?

Off the top of their head they should realize that all these indicators like moving averages or stochastics are always lagging. They are great if you want to know what has already happened, but it provides no ability to forecast future prices.

The other thing that these traders need to understand is that 95% of all forex traders lose money. If that’s the case why would you want to be doing the same exact thing that every other struggling trader is doing?

Think about this from a logical perspective. Chances are traders that are on a forum are struggling with their trading. If that wasn’t the case why would they even be there? Most truly successful forex traders don’t have the time nor the inclination to hang out in a forex forum.

The real popular discussion on these forums are about the Forex Expert Advisors. For anybody that doesn’t know what these are, they are basically trading robots. Developers use trading systems with lagging indicators so that this robot trades for you, while you’re away.

I could see why this would attract most newbies traders. I mean, who wouldn’t want to have all that free time to yourself. You can go to the beach, the ballgame, dinner and a movie and all the meanwhile you’re becoming rich, right? Well, not exactly. That’s not the way it works.

People are asking way too much from these expert advisors. Think about what people asking from them. They are asking them to acccomplish something that most forex traders in the world can’t do: Make money trading forex.

For those that want to have a deeper understanding of the market then, I recommend you get rid of all your indicators and start trading the markets on a clean chart. Just follow the price action. See if you can start to notice patterns that are always happening. These are the kind of patterns you need to focus on, because this is how you forecast future prices.

No related posts.