Overcomplicating Trading the Forex Markets

Filed under: Learn Forex Trading |

Screen shot 2013-06-06 at 10.43.12I think that there is an omnipresent danger of overcomplicating trading the forex markets. People seem to be using increasingly complex algorithms to inform their trading decisions, with many traders using pre-programmed trading robots to make their trades for them. However, one has to remember that the forex markets are made up of individual people, and as such, the markets are moved by mass psychology, corporate decisions (causing big market moves), and world news. These are things that algorithms cannot account for, and in the end, there is a human element to the markets that requires a human solution.


You may have realised by now that, when it comes to trading, I am more of a traditionalist. People have been trading for hundreds of years, and strategies that have been used in that time are still relevant today. Sure, there are some trading robots that work for a while, but the profits that are made this way are usually short lived – as they only work in certain market conditions.


Personally, I think that there is no substitute for investing in your own trading education, because once you have the skills needed to trade successfully, then you will have these skills for life. It is all too easy to waste time looking for the holy grail, a set of system rules that bring profits no matter what the timeframe or market conditions. But I doubt such a system is even possible. However, markets will always have trends, and markets will always consolidate, and if you can learn to trade in these conditions, then you will be on the right path. I don’t think that there are really any shortcuts in trading, and those who look for shortcuts, generally tend to get lost. So my advice is to invest in yourself – not in other people. If you do, you may well reap the rewards.

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