I’m writing this article after I spoke with one of my traders a few days ago and she was asking me about how to exactly to locate high probability trades to profit from the markets.
Forex strategy trading requires that you follow your trading plan, be disciplined, and only trade high probability trades.
Most Pro traders use simple strategies with strict money management to assist them to achieve their trading goals and profit consistently from Fx trading. In this part of my Forex strategy trading tips series I’ll be referring to 3 easy methods I use to help me select high probability trades.
Never opposed to the market current: Even though I do use many custom indicators and trading strategies, most of my trading is still based on basic trading principles. I always respect the overall trend and don’t attempt to go against it. I additionally respect strong support and resistance levels as they represent the region where demand and supply meet. The foreign exchange market is bigger than us and even when you have huge amount of money in your trading account it is just about impossible to ever manipulate the market and make it go your way.
Make use of the K.I.S.S Principle: The KISS principle stands for “keep it smooth and simple”. Among the best techniques for getting confused, commit mistakes, and throw money away is to utilize complicated trading strategies that you don’t really understand. I have been trading the markets for years and I still don’t use anything but very basic (but extremely powerful) trading strategies that enable me to produce the type of returns I expect from Forex trading. There’s a Forex myth that claims that “complex Forex currency trading systems are more effective and make more money than the simple trading strategies.” This is not always true. I know some very successful traders who don’t use more than a set moving averages and a MACD indicator to enter the market and cash in on it. So don’t forget regardless of what system or strategy you choose to use remember to keep it simple and running smoothly.
Concentrate on your trading strategy and plan & ignore all the “noise”: The Forex market is full of opportunities. There are millions of Forex robots, indicators, strategies, mentors, signal providers, etc… However, the real challenge is to filter the good guys from the bad guys and frequently all the noise coming from other traders or companies can distract you tremendously.
This happened to me initially when I first started. When I got started as an Forex trader I was trading with several professional Forex traders who all trade in many different ways. This made discovering my trading personally and my trading style very difficult. Nevertheless, I understood that if I wanted to become a professional trader I was going to need to perform analysis and trade based upon my own judgment, not someone else’s.
Therefore, I strongly believe that anybody who aspires to become a profitable trader needs to develop themselves as traders and trade based on their unique judgment (even if you use someone else’s trading system, you are the one that must make the system work!).
Over the next few days I will be teaching more Forex strategy trading tips straight out from my Fx trading vault.
To your trading success,
Jay Molina