Learning price action – the key to your forex trading success
Learning Price Action – The Key to Your Forex Trading Success
I wanted to start today by thanking each and every one of my loyal followers. Recently, this blog had it’s 3rd birthday (I can’t believe it’s been that long). I wanted to thank all of you for your ongoing comments, your emails and your feedback, and I want to make important mention to all of my members, without your support and commitment, none of this would have happened. My passion for teaching and assisting forex traders continues to remain strong, I want to remind all of you, this is a life long project, and I will be here for many many years to come. This website started from something small and has now grown to be one of the most popular forex education resources in the world, attracting more than 50,000 readers per month and growing strong. I want to personally thank all of you for your continued support and for sharing the content on this blog with your fellow aspiring traders. I ask all of you to keep reading, keep learning and keep sharing this with others. Enjoy today’s article.
The ability to read and make sense of the price dynamics that occur on a “naked” price chart every day in the Forex market is a necessary component to becoming a profitable trader. Price is the main component involved in all financial markets, so it is a curious notion that so many trading strategies and systems floating around the internet seem to focus on everything BUT price.
Here at learn to trade the market, I teach traders how to read the natural price action of a market, and this is a skill that is a prerequisite for developing yourself into a consistently profitable trader, no matter what trading strategy or system you ultimately end up using.
• Price action trading helps you become confident in your trading ability
Learning to trade the market with price action strategies allows you to make use of the natural ebb and flow of the market in a way that is not confusing or secondary like trading with indicators or “Forex robots”. As a trader you want to develop your chart reading skill so that you can confidently trade what you see, not what you think. When you learn how to read the price action of an uninhibited price chart you will develop this confidence because you know you are basing your trading decisions off the “core” data (price action) of the market, instead of a delayed and vague representation of price action. Traders who spend hours trying to interpret lagging indicators or who spend tons of money on over-hyped trading software, quickly find out that these approaches are simply well-marketed techniques that look pretty but are largely ineffective and more confusing than anything else.
Trading with price action gives you a solid foundation to build your overall trading strategy on, since you know what you are looking for and the method is not confusing or secondary you can quickly develop confidence in your trades. This is a key distinction between price action trading strategies and indicator-based methods, and it’s one of the reasons why trading with indicators destroys Forex trading success. Indicators and trading software make it really hard to become confident since you are always trying to figure out what the indicators are telling you (they often contradict one another), and you probably have no idea who or what is behind a piece of Forex trading software.
• Knowledge of price action trading will ONLY make you a BETTER trader