Trading Price Action has go to be the most overlooked trading method in the forex market. There is a very simple reason I say this. Just look at how many people fail at trading forex.
If you haven't heard the statistic, here it is: 95% of people who trade forex, lose money.
I know that statistic is rather depressing, but if everybody just stopped making the same mistakes that most losing traders make, there is a very good chance that you could be part of the 5%.
So how is it done? This is so easy, that I can't believe more people don't think of this. Why don't you just do what the rich and successful do?
If you do a little research, you'll find out what the number one weapon is for the traders that are doing this full time. It's price action.
Obviously different traders use price action in different ways. But the main point is almost none of them use indicators like Stochastics as part of their trading methods.
Who does use indicators? I don't want to pick on them, but if you go on almost any forex forum, you'll be stunned to see how many traders rely on indicator heavy systems. THEY DON'T EVEN LOOK AT THE PRICE! All that matters to them is what the indicators are showing.
It should be becoming quite clear as to why 95% of the public fail at trading forex.
The thought of trading price action never even crosses their mind. They'd much prefer some random indicators, which are just lagging formulas telling you what has already happened, to tell them when buy or sell.
Price action trading is pure. There are no gimmicks to it. It tells you what you need to know, and leaves out all the clutter. It's almost as if the market is speaking to you. The problem is with all those indicators, it's kind of hard to hear it.
John Templeton has been a successful forex trader after trading price action. Once he understood that all he needed to trade forex was on a plain chart with no indicators, his profits soared. |
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