Why Trade Forex with Price Action?
The forex market is a highly liquid and fast moving market that lends itself wonderfully to the trading method of price action analysis. Price action analysis is the identification and implementation of specific price action signals or setups in whatever market you are trading. Forex is a great market to use price action analysis on because it is open 24 hours a day 6 days a week and this means there many price action signals for you to take advantage of. All you need to know is what to look for on your charts and this is best learned from a professional price action trader.
I have tried about every way to trade the market you can imagine and after all the frustration, time, and money wasted I ended up realizing that the most lucrative way to trade any market is just by analyzing a naked price chart. My unique way of trading forex using price action setups is a result of many hours of screen time spent analyzing price movement and price patterns. I have learned from other price action educators and added my own style and ideas to their methods. Trading is a process of trying different methods, tweaking them, and eventually ending up with your own unique trading method.
Price action analysis works great in the forex market because it is such a dynamic and active market. The amazing thing about price action analysis is that it is an inherently flexible approach to trading that gives you a perspective on the market that allows you to make sense out of what is happening at any given time. I have been consistently profitable by concentrating on just 2-3 good price action setups that have proved profitable again and again for me. If you learn how to read what the chart is telling you and focus on 1 to 3 setups that you like, eventually you will profit. Where people go wrong is using indicators and other overly complicated trading methods and then constantly jumping from one technique to the next. You need to find a truly consistent edge in the market and then just concentrate on that until you get it down, then you can maybe add more tools to your arsenal.
Trading is difficult enough without having an overly complicated method that tells you to look at multiple lagging indicators when you could just be looking at a simple naked price chart. Probably the best reason to trade forex using price action is that any indicator you use on your chart to analyze market movement is derived from price and is just showing you in a less vivid format the same thing price is showing you. Some people like indicators because they give you buy and sell signals when the lines cross or whatever. The thing is, if you know the price action signals to look for you can get the same entry signals but at a much better price which gives you a better chance at profiting.
Just because your charts come with a hundred different indicators doesn’t mean they are going to help your trading or make you money in the markets. We are trading financial markets here, so the core of what we are doing is trying to profit off of price movements. Why people might not naturally make their trading decisions off of pure price movement is beyond me. I promise you that if you simplify your trading method and concentrate on using price action you will wonder how you ever traded any other way.
Tags: forex trading, forex training, price action, price action analysis, price action education, trade forex using price action