Not The Market, Not World Events, Not The Economy- You

Category: Finance, Currency Trading.

To operate effectively in any forex market investing environment, you need rules and boundaries to guide your behaviour.

There are many types of trades which the risk of loss is unlimited. No matter what system you` ve developed, the potential exists to do financial damage to yourself- damage that can be greater than you think is possible. To prevent this kind of loss, you need to create an internal structure in the form of guide lines that determine your behaviour so you always act in your own best interest. The markets provide structure in the form of behaviour patterns that indicate when an opportunity to buy or sell exists. This structure has to be internal because the market won` t provide it for you. But that` s where the structure ends. Nothing happens until you decide to start or forex market investing.

With a simple indication. You continue to trade as long as you want. All the beginnings, and endings of, middles your trades are the result of your interpretation of the information available from the market. And there is no end until you decide to stop. However, while the average trader may want the freedom to make these choices, but that doesn` t mean they are ready and willing to accept the responsibility for the outcomes. Not the market, not world events, not the economy- you. The reality of forex market investing is that, if you want to be successful, you have to accept that no matter what the outcome may be, you are completely responsible.

Traders who are not ready to accept this responsibility can find themselves in a dilemma: How do you participate in an activity that allows complete freedom of choice and avoid taking responsibility if the outcomes of your choices are poor? Random trading can be defined as poorly planned trades, or trades that are not planned at all. This can be accomplished by adopting a forex market investing style that is random. Randomness in trading is unstructured freedom without responsibility. But at the same time, it` s very easy to avoid taking responsibility for the trades that didn` t turn out the way we wanted, because there` s always some variable we didn` t know about and therefore couldn` t take into consideration beforehand. When we trade without well- defined plans and with an unlimited set of variables, it` s very easy to take credit for the trades that turn out to our liking, because in our minds we used some kind of method.

Random forex market investing is an unorganized approach that doesn` t allow you to find out what works and what doesn` t. If it` s impossible to generate consistent results, then we really don` t have to take responsibility. If the market` s behaviour were truly random, then it would be difficult, to create consistent, if not impossible results. However, direct experience with the market tells a different story. Even though the outcome of each individual pattern is random, the outcome of a series of patterns is consistent and statistically reliable. The same market behaviour patterns present themselves over and over again. These patterns can aid your forex market investing if you choose to use a disciplined, and consistent approach, organized.

Then, instead of making the trades they planned, they do something else. Many traders spend hours doing market analysis and planning trades for the next day. The trades they make are usually ideas from friends or tips from brokers. Why would they do this? By making unstructured, they are able, random trades to avoid responsibility. When you act on your own ideas, you put your abilities on the line and get instant feedback on how well your ideas worked.

On the other hand, when you enter an unplanned, you shrug off, random trade the responsibility by blaming your friend or broker for their bad ideas. It` s difficult to rationalize away any unsatisfactory endings, since they` re the direct results of actions. The nature of forex market investing itself also makes it easy to escape responsibility. It takes a lot of effort to create and follow a disciplined approach that will make you a consistent winner. Any trade has the potential to be a winner, whether you` re a great analyst or a poor one. But, if you invest the effort, you can achieve success as a trader, and reap the benefits of the market.

Read more...

Learn Forex Trading By Starting With The Time - Finance and Currency Trading:

The foreign exchange market is a dog eat dog world and if an investor ventures in without the essential arsenal of knowledge and tools, it can lead to financially devastating results. There are many frauds out there that claim to have the ultimate Forex system that will make you rich overnight.

Most Traders Don T Take A Rational Approach To Trading And Have Unrealistic Goals - Leta Dalrymple's Finance and Currency Trading blog:

Most traders don t take a rational approach to trading and have unrealistic goals. Here are 10 tips that will improve your trading by 100% and help you reach that level of consistence you are looking for.