Set and forget forex trading – keep your day job
Very often aspiring forex traders become lost in a web of confusion with the amount of data that the various financial media outlets plaster all over the internet and television. It is extremely easy to experience “analysis paralysis” while trying to trade forex or any market for that matter. There are so many competing ideas and trading methods along with more fundamental data coming out every day than you could ever hope to digest, it can be very overwhelming to even try and make sense of it all and develop a forex trading plan based off this amount of information. One of the biggest psychological mistakes that almost every aspiring trader makes on their journey to success is firmly believing that the amount of economic data analyzed and (or) having a technically complicated or expensive trading method has a direct linear relationship with profiting in the market. In reality, as any professional trader will attest to, these factors usually have an inverse relationship with trading profits, at least after certain point. This essentially means that once you do a certain amount of analyzing market data any further time spent analyzing this data is likely to have a negative effect on your trading; it causes you to lose money.
Why it’s Counter – Productive to Analyze too Much Market Data
It may seem confusing or counter intuitive to the aspiring forex trader when they first hear the fact that too much analyzing of market data can actually cause you to lose money faster than you other wise would. This is one of the inherent psychological traps that so often keep aspiring traders from consistently profiting in the forex market and is the reason why many of them blow out their trading accounts and eventually give up all together. The main reason why this occurs is because human beings have an innate need to feel in control of their life and of their surroundings, it is an evolutionary trait that has allowed our species to perpetuate its existence and ultimately arrive at our current modern day level of civilization. Unfortunately for the aspiring forex trader however, this genetic trait of all human beings works against those trying to succeed at forex trading. In fact, most of our normal feelings of wanting to work harder than the next guy or spend extra time studying and researching for our jobs or for school are feelings that are really not beneficial to success in the forex market.
The problem with trying to apply the idea of hard work to forex trading is that beyond a certain level of technical chart reading ability and awareness, there really is no beneficial aspect to spending more time on tweaking a trading system or analyzing more economic reports. The bottom line here is that there are literally millions of variables involved in trading the forex market; each person trading the market is a variable and every one of their thoughts about the market is a variable because these are all things that can cause price to move. So, unless you are somehow able to keep track of every trader in the market and all of their thoughts, you essentially have no control over price movement and trying to further analyze economic data or trying to come up with an overly complicated method is essentially just a meaningless attempt to control something that simply cannot be controlled.