Why Price Action Is So Imprortant
I would have to say that the most difficult thing for many new and unsuccessful traders to overcome is that they don't really ever learn to have a strong grasp of the market. In fact, most are probably dealing with lagging indicators. These kind of trading systems usually rely heavily on when these indicators match the same trading direction. I'm not trying to demean this, because I actually used to trade like this. But when you take one loss after another, you tend to look for better ways to trade.
After all, can you honestly say that you understand what the market is doing when all you are doing is looking at some kind of indicator that is telling you WHAT HAS ALREADY HAPPENED? Of course not!!!!
Not to be rude, but the market couldn't care less whatever your indicators are telling you. Stochastics mean nothing, and I can prove it to you. When you think about the most successful traders who have ever lived, do you think they are using stochastics to tell them what is going on in the market? I don't really think so. However, if you want to take the time to study what most of these traders to care about, there are two words: PRICE ACTION.
When it comes to price action, they might not have used it all in the same way, but I can assure you that price movement was their main criteria. I don't care if its stocks, bond, the S&P, etc....It simply comes down to what is the price doing, and how can I make money from it. Honestly, there isn't really that much separating all the successful traders in the world with those that have failed or are failing. It's not as if these succesful traders are that much brighter than the unsuccessful ones. Most of them didn't graduate from Harvard with honors. In fact, you'd be surprised to know that many of them barely finished high school.
When it comes to the rich traders and how they became successful, you have to know that they are to truly and understand what the market is saying to them, much like a person would read a book. These traders actually understand the fundamental reasons as to why price will start and stop at certain price levels. It's not just a bunch of lines on a chart. It's more complex than that. You can use this kind of information you get rid of that job you can't stand earn a living, trading the market.
Its not really difficult. Anybody can understand price action. Its just that most people don't want to take the time to really understand how to read the energies of the market. Everybody always wants that holy grail or magical indicator that people can just plug into their trading platform and it'll do all the work for you. Well, it doesn't work like that. It would be a great if it did, but it doesn't. I had to learn that the hard way. But, as is life, you live and you learn.
The tough part is getting somebody to actually teach you how to see the market from this kind of perspective. It's difficult learning it for yourself. If it were, we'd all be millionaires. Most of the time all you need is a little bit of information and some time to digest that information, and BAM! you're off and running. Thankfully I was able to find Trading in The Buff by John Templeton. When I saw the sales page, I though "ok, it looks good but how do I know if its legit". I've been burned many times before (as I'm sure some of you have) so it's hard to distinguish the valuable information from all the crap that is being sold out there. But I saw that he had an unconditional money back guarantee. No questions asked. I figured "why the heck not? I'll demo it and see if it I like it. If not, oh well I'll just move on to the next thing."
But something interesting happened. I realized everything I need is right IN FRONT OF ME. I just have to eliminate all the crap that's blocking my view. I used to trade with sctochs, FIBOs, Moving averages. It turned out to be the last forex training I'd ever need (It feels really good to say that). I thought I would be wandering around aimlessly from one system to another for as long as I live, or until I was dead broke, which ever came first. But, eventually I just found out that less is more. Not until you see the market's movement in all its glory with no interference, then you can't really say "I am a trader". - 23310
After all, can you honestly say that you understand what the market is doing when all you are doing is looking at some kind of indicator that is telling you WHAT HAS ALREADY HAPPENED? Of course not!!!!
Not to be rude, but the market couldn't care less whatever your indicators are telling you. Stochastics mean nothing, and I can prove it to you. When you think about the most successful traders who have ever lived, do you think they are using stochastics to tell them what is going on in the market? I don't really think so. However, if you want to take the time to study what most of these traders to care about, there are two words: PRICE ACTION.
When it comes to price action, they might not have used it all in the same way, but I can assure you that price movement was their main criteria. I don't care if its stocks, bond, the S&P, etc....It simply comes down to what is the price doing, and how can I make money from it. Honestly, there isn't really that much separating all the successful traders in the world with those that have failed or are failing. It's not as if these succesful traders are that much brighter than the unsuccessful ones. Most of them didn't graduate from Harvard with honors. In fact, you'd be surprised to know that many of them barely finished high school.
When it comes to the rich traders and how they became successful, you have to know that they are to truly and understand what the market is saying to them, much like a person would read a book. These traders actually understand the fundamental reasons as to why price will start and stop at certain price levels. It's not just a bunch of lines on a chart. It's more complex than that. You can use this kind of information you get rid of that job you can't stand earn a living, trading the market.
Its not really difficult. Anybody can understand price action. Its just that most people don't want to take the time to really understand how to read the energies of the market. Everybody always wants that holy grail or magical indicator that people can just plug into their trading platform and it'll do all the work for you. Well, it doesn't work like that. It would be a great if it did, but it doesn't. I had to learn that the hard way. But, as is life, you live and you learn.
The tough part is getting somebody to actually teach you how to see the market from this kind of perspective. It's difficult learning it for yourself. If it were, we'd all be millionaires. Most of the time all you need is a little bit of information and some time to digest that information, and BAM! you're off and running. Thankfully I was able to find Trading in The Buff by John Templeton. When I saw the sales page, I though "ok, it looks good but how do I know if its legit". I've been burned many times before (as I'm sure some of you have) so it's hard to distinguish the valuable information from all the crap that is being sold out there. But I saw that he had an unconditional money back guarantee. No questions asked. I figured "why the heck not? I'll demo it and see if it I like it. If not, oh well I'll just move on to the next thing."
But something interesting happened. I realized everything I need is right IN FRONT OF ME. I just have to eliminate all the crap that's blocking my view. I used to trade with sctochs, FIBOs, Moving averages. It turned out to be the last forex training I'd ever need (It feels really good to say that). I thought I would be wandering around aimlessly from one system to another for as long as I live, or until I was dead broke, which ever came first. But, eventually I just found out that less is more. Not until you see the market's movement in all its glory with no interference, then you can't really say "I am a trader". - 23310
posted by Mr. Forex at
4:02 AM
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