Learning to Trade Forex Using Price Action ~ forex hedge trading system
If youre curious about getting a deeper understanding of how to trade the forex markets, youre going to have forget about all those lagging indicators that youre using.
Indicators such as MACD may look great on the charts, but youd be hard pressed to find anybody who can use it to get a deeper understanding of the markets.
I imagine many people know the rules of how to trade the MACD, but how many can actually proclaim they know what it has to the underlying reason for the price movement? No too many.
While using indicators such as these may seem like a great shortcut for learning the forex market, the real truth is youre just using it as a translator of the market. The indicator translates what it sees to you and shows what it sees through different colors and lines. This may seem like a great idea, but its really not.
YOU should be the translator. The market shouldnt have to be translated for you. Its like going to live in a foreign country for a year. You could probably always find somebody who spoke English, but to really be able to live and enjoy the culture, you are going to have to learn to speak the language. Its the same case with trading forex. Except the language you have to learn is price action.
The first thing you need to do to learn this new language is get rid of all your indicators that you use to trade with. Dont leave a single one. Youre only cheating yourself. Then, pick a currency and just watch it for the day.
I know some of you probably think, that doing some like this will not lead to anything great. Well, if you have that attitude, then it probably wont. However, if you have an open mind youll start to see that price pattern repeat constantly and that can be used to trade the markets.
If you dont really think its possible to do this, then research the name Jesse Livermore. Livermore became rich in the early 20th century by just trading on the market floor. All he used was the price action from the other traders on the floor to base his trading decisions off of.
By Jim Buhs
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