Forex

FOREX;Technical Analysis and You (1).

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The path to financial independence and making money online in this new knowledge economy most of us will observe is never one laid with the finest of gold.It's dogged,it's tough yet,in my own opinion,pretty interesting.I like the game anyway.Many may disagree.No mentor,or course,or literature can give anyone the holy grail to the secrets of success in trading the markets.On finding our common path,everyone will have to travel it alone coz,its all about YOU and your guts to go ahead with the feeling.As no one, sells the goose that lays golden eggs,probably the eggs,but never the goose.Nevertheless,I will humbly attempt.
Like I presume most of us are aware of the two main analysis methods deployed in trading the markets,Technical Analysis is one common to most traders.From careful observation in recent times and online interaction with traders across board,majority use it and the historical data they present as though its the holy grail in trading the markets.How far that is from the truth.Any person with a good brain on their shoulders,will ultimately come to the realization that these are just tools.Tools that are built on historical and lagging databases.Moreover the rigidity of the parameters used in the studies imposes rigid responses to changing market conditions.Have we forgotten that the market is a live beast that learns and adapts to trade behaviors?Many have forgotten that the market is the sum total of the behavior of the participants engaged in the marketplace.It also gives credence to the efficient markets theory....how this prove true in the long-run is a discuss for another day;cos,Algorithm do take trades too.It has a behavior too,don't you think?These tools are used for measuring the market health,not so unlike the thermometer to a doctor,or the measuring tape to a carpenter,its just a tool.

Then how is it possible that these studies themselves can be considered the "Holy Grail"?It may be due to ignorance( being new and uninitiated),laziness or plain stubbornness( a little knowledge is a dangerous thing).Of course its not nice for me to tell you about those who have a "little knowledge",trying to scam those who know less than them.That's another story.Some do so,because of a very new disease discovered recently,the sickness of "the chance".
If you use the Technical studies as your "Holy Grail",I have only one word for you,GAMBLER!


(2)
I put it to you that,to consider your Technical Studies to be more than what they are is a "fallacy" in trading the markets,not so unlike martingale gamblers' fallacy.It can lead you to a very dark place.
What many traders do not know,or may fail to recognise,is that your success in taming the markets is comprised of a mix of ingredients.Not so unlike in baking cakes.
I suggest three very important ingredients.One is "Market Structure",the other is "YOU",then Capitalisation.Of course there are many more components,for the moment these seems to be of most dominant importance,in my humble opinion.
I hope you will think about I've said carefully.I shall try to push these door ajar for you slowly to show you the light at the end of the tunnel(please hope there is no on-coming train)God willing.

(3)
We are all humans and such need the reasons to do things.For us to take any action we would need a reason to do so.That's I beieve the first thing that the Technical Analysis does for a trader,it gives him a reason to buy/sell.We all want to believe that everything happens for a reason.In real life that is true to a certain extent.The markets however is kuit different from what we know in the real life.There are many reasons for the price to rise/drop and assume that the reson is a couple of skuiggly lines or a fib number is foolish and naive.The indicators may provide the trader with some help in making the trading decisions but in no event are the signals provided  by those indicators responsible for the outcome of the trade,simply because they can not influence the outcome.
If one is trading based on TA,there should be a set of rules/indicators that one uses in thesame manner all the time.In no event will those indicators provide perfect signals,and to try and tweak them until they do is a waste of time.One should take the indicators for what they are and try to exploit the little edge that they provide the trader with.We all want consistent profit but most fail to be consistent in their approach,because they want their indicators to give them pefect signals.
Sometimes you win and
 sometimes you learn.



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