When I started out on my forex trading journey, I made the assumption that what I was learning to do was predict price.
In hindsight, I can see that assumption subconsciously dictated much of my early development. Having that view meant I actively looked for systems, strategies and techniques that appeared to or attempted to predict price.
What I came to learn more recently, is that attempting to predict price is a bit of a fool’s errand. My current thinking is that a prediction of direction only occurs when the direction of the market is weak or unclear. When the direction of the market is strong, there is no need to predict direction - it is obvious. When the direction of the market is strong, the only question to ask is whether the trend is going to continue.
So if prediction of price is required - or even possible, I am not interested in that market at that time. The result of that view and trading approach is that I only trade strong markets.
A distillation of my approach would be;
So I no longer try and predict price, i merely find a market that is moving and make sure it is still moving, then try and hop in the market using a precise strategy.
The result of my ‘precise strategy’ - is that most times i miss out on an entry in the market because the market doesn’t fit my specific requirements, or I miss out on an entry because the market stalls. Sounds like a bummer right?
The important point is that neither of these scenarios cost me a cent!!!
Unlike the days when a moving market was enough for this monkey to go chuck his hand in the jar and just hope he can pull it out afterwards, with disastrous consequences, I now sit and wait for the right conditions prior to a trade.
And I don’t hope i can get away with breaking my rules just this time - because I was sure the market was ready to pop. Trading like that is just a crap shoot.
