Introduction
People interested in trading currency on the foreign exchange currency market (FOREX) soon discover that it’s not as easy as it seems.
These people are naturally drawn to investigate different FOREX trading systems. Many are lured by marketing claims allegedly backed by statistical evidence of trading systems that capture a tempting number of pips a phenomenal percentage of the time.
These systems often rely on elaborate combinations of technical indicators that mainly succeed in creating so much trader confusion that there is no way to separate hype from reality.
First, here are a couple of questions to get answered for any trading system you consider buying.
Question One
Ask this of every system seller: If your system is so great, why do you want to sell it?
You may not receive an adequate answer the closest you may get is “because we need more money to trade with ourselves.”
If the system was as good as the claims, this would never be the reply.
Question Two
Ask the system vendor this: Do YOU trade?
In many instances, the reply may be, “We choose to focus on making our clients better traders.”
Avoid a company that lends this type of response.
Easy FOREX System
A simple understanding of the laws of supply and demand are all that is really needed for this system.
When something is in good supply and no one wants it, prices will be low. That’s the time to buy. When something is scarce and everybody wants it, prices will be high. This is the time to sell. When these two forces are in balance, that is the time to go watch some rugby or head to the track for a punt or two.
Practical Steps Toward Using this System
1. Simulated trading – Good trading platforms will permit you to have multiple trading profiles. Have one profile where you can practice with the same amount of money as you intend for actual trading. Have one or more profiles where you can practice with a larger sum. The benefit to this is that you will gain the practical experience of observing the effect of price swings on your P &L, and by using a larger theoretical sum, you train your mind and body to adapt to the feelings you will experience when there is more at stake. Insist on a broker that provides this, as well as permitting you to continue simulated trading after you have gone live.
2. Use multiple time frames – What may look like an uptrend on short time frames could just turn out to be a market seeking resistance prior to resuming a longer term downtrend. Apply the opposite to instances where a short-term downtrend could be a market seeking support before resuming an uptrend.
3. Buy support/sell resistance – It is scary to buy when prices have been dropping or sell when they have been rising. The advantage this technique offers is that when it turns out that you’re wrong, and at times you will be, you will know quickly. When support fails on your long trade or resistance is broken on your short trade, you must admit that you were wrong this time and exit the trade quickly.
These are just a few helpful tips. For more information on Easy Forex Systems be sure to contact www.lucrorfx.com today!