To trade forex successfully you have to time your trading signal. There are many gurus vendors telling you can predict tops and bottoms in advance but this is the biggest myth of forex trading you cant - you can time your signal differently though and still make a lot of money.
If you try and predict market tops and bottoms you are simply hoping or guessing that support and resistance will hold and this will see the demise of your account equity.
The Kirk Report : Q&A With Kirk::
Otherwise, if you're prone to frustration, being a lazy portfolio investor who doesn't do any kind of market-timing is a better approach.
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The reason for this is markets do not move to scientific theory as many people think. This is common sense! If they did we would all know the answer in advance and there would be no market.
Markets dont move by Hocus Pocus or a magic formula, its a bit more complex than that!
Humans decide the price of anything and the millions of traders who contribute the market price, are NOT logical and you cannot tell what they will do with any certainty at all.
Understand this in regard to forex market timing:
Forex trading is a game of odds NOT certainties.
If you understand the above, you can still make money - but your not going to predict your market timing, you are going to trade on the reality of price change and trade the truth - i.e the market price as it is.
If you want to win at forex trading you need to trade on confirmation.
If you dont know anything about using leading indicators or price or momentum oscillators, its time to start making them part of your forex education.
For example you see prices dip to support but you dont simply buy - you wait until prices turn away from support - supported by price momentum. Then you execute your trading signal.
We dont have time to discuss the individual indicators here, simply see our other articles for a fuller discussion of momentum.
Sure you miss the turn but you didnt know the price would turn would until AFTER it did so thats not a problem.
Many traders are obsessed with trying to be clever and trying to get in with pinpoint accuracy - but its impossible to do so dont try.
Your objective in forex trading is to make money and if you use market timing in line with price momentum, you can do this and trade with the odds for long term currency trading success.
If you got just 50% of every major trend you would be very rich.
So think about the money you can make rather than feeling smug.
Today, advances in science and computer technology are staggering and your personal PC contains more power than the computer Mission Control used for the moon landings and its tempting to think that computers can predict in currency markets - but they cant.
Predicting a chaotic market with accuracy is impossible and anyone who tells you they can is a liar or a fool.
Of course, as we have said this doesnt mean you cant make money you can you simply trade price momentum and trade the odds. Understand the above and you are well on your way to currency trading success.
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Forex Market Timing - Why if you Try and Predict your Guaranteed to Lose