forex-price-action-why-im-not-giving-up

Forex Price Action – Why Im Not Giving Up

Hello Price Action Traders

I’ll be delighted when 2016 is over.

The end of the year is in sight now, thankfully. I can’t wait to pop the corks on 31st December and bid farewell to a difficult year of trading.

Mind you, at the start of 2016, things were looking great.

I was expecting to see the Japanese Yen strengthen. And it did, in marvellous fashion. I had my trades in place, and it was just a case of watching the pip-count steadily accumulate. On an almost daily basis. Trading nirvana!

forex-price-action-dxy-monthly-chart

The end of year hasn’t been terrible either. Trump winning the US election finally kicked off a nice US dollar rally that I’d been patiently waiting for since July, or even earlier.

So, when I review 2016, what do I see?

The start and the end of the year were ok, but that big chunk of time in the middle, was just… well, horrible. I endured long periods of time without a decent-size profitable trade, and many, many small losers.

9 months is a long time to be just treading water.

I know I’m not the only one who’s had a tough year. Any forex trader who relies on trends that last longer than a few days has suffered in 2016.

So, given all that, what am I going to do differently in 2017?

Well, the answer to that question is – probably very little.

I’ll be doing pretty much the exact same thing.

forex-price-action-why-forex

I know what the questions are going to be:

  • But if it’s so hard, why do you keep going?
  • Why don’t you change your strategy?
  • How do you not want to quit?

Everybody has their own reasons for how they trade. I can’t speak for anyone else, but I can tell you how I know that I’ll still be here in 2017.

Give me a moment I’ll explain why.

If you’re new to Forex Useful you may not know this, but if you’ve been around Forex Useful for a while (or especially if you’re a Pro Member) you’ll have heard me talking about the importance of having an edge in trading.

Now bear with me for a moment, please.

We hear tons of cliches in trading. Silly, often meaningless sayings, and once you hear them a few times it’s easy just to let them fly over your head.

You file them under “yeh, like I haven’t heard that a millions times before” and you don’t bother taking them in.

But if you listen to nothing else I’ve ever said, listen to this:

if you don’t know what your edge is in trading, please stop until you find out.

At least stop until you find out how you might be able to develop one.

The markets are likely to quieten down from mid next week until early January. So if the idea of an “edge” is a still a wooly, abstract concept to you, here’s my advice:

Take the coming few weeks, fire up your internet, and gorge yourself on every single bit of information about edges in trading that you can, between now and January. That’s plenty of time to learn everything you need to know about the subject.

If you do that, I can assure you that you’ll start your trading in 2017 with a different mindset.

Hell, you don’t even need to listen to me – listen to this guy. He knew a lot more about it than I probably ever will:

forex-price-action-mark-douglas

Mark Douglas – Author of Trading In The Zone

Having an edge is where your money comes from.

Not having an edge is where your losses come from.

Just as it’s mathematically impossible to make long term profits without an edge, it’s also mathematically impossible not to make profits if you do have one.
It’s the very genesis of profit and loss.

This doesn’t just apply to trading. It applies to all forms of business.

In business, your edge might be having a slightly better deal with a supplier than your competition. A nicer website that attracts more customers. A developing trend that you’re ahead of. A piece of legislation you’re taking advantage of.

It can be anything.

Ask any good businessperson why they make money over their competitors, and they’ll be able to answer you in a flash. They’ll know what their edge is. They’ll know why they make profit.

Ask any forex trader what their edge is, why they expect to profit, and most of the time you’ll be met with a blank stare.

What? Edge? What’s that!

Let me get back to my indicators!

forex-price-action-more-indicators

Knowing your edge provides stability in your trading. It breeds confidence.

And there are a million different ways to develop one.

Dacia is a car manufacturer that sells lots of cars that are very cheap.

Pagani is a car manufacturer that sells a very limited number of cars that are extremely expensive.

Both can have an edge and make money – they are just going about it differently.

It’s the same with markets. You can develop an edge with fundamentals, or an edge with technicals. You can develop an edge in anything.

But you need to have one.

Finally understanding this concept of an edge was what made me give up gambling all those years ago. It took me years to figure it out.

(I didn’t call it “edge” at the time – the term that was used in the gambling community was “value”. I read about “value” all the time on those betting websites. But because I didn’t understand it, I just dismissed it and went back to guessing which horse was going to win the next race. Make sure you don’t make the same mistake.)

Understanding the concept of an edge is why I never, ever play the lottery.

And understanding the concept of an edge is why I’ll still be trading in 2017.

I’ve been battered in 2016 yes, and at times my edge has come under pressure. But however bruised it might be, I still think it’s there as I move into 2017.

The second I think it has disappeared, I’ll stop trading and won’t regret
that for one second.

But for as long as it’s there, I’ll continue trying to exploit it.

I suggest you do the same.

Here’s to 2017!

All the best,

Nigel

P.S. I devoted a whole section of the PAST Video Course to how I develop my edge in the markets. If you’re a Pro Member and you haven’t watched it yet, I’d encourage you to do so. If you’d like to become a Pro Member learn more about this topic (and many others) you can sign up here.

Need your charting fix for the weekend? Pro Members can watch the latest analysis of DXY, EURUSD, USDCHF, AUDUSD, NZDUSD, SP500 and FTSE from Friday’s Workshop here.

Pro Members can watch the Workshop replay here.

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DISCLAIMER & COPYRIGHT

This update is based on my analysis on my charting package. It may differ to yours as it can be affected by time, market movements, charting packages and broker prices. I accept no liability for loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on any information in this report or analysis.