Financial Trend Blog

You can make money using Forex charts but most traders lose and the errors they make are listed below. You can make a lot of money using forex charts but you must use them correctly, so here are the errors you must avoid.

Trading Invalid Data

You need to use data that can help you calculate the odds and that means using enough data to allow you to do this.

This is common sense, yet a huge number of novice traders still try day trading – it doesn’t work PERIOD.

In an article a week ago “US Dollar Outlook - Dollar to Strengthen Further” we postulated that the dollar would have a good week and so it has proved. Our logic was purely based upon trader psychology NOT the fundamentals or news. This week’s action shows graphically how important trader psychology is.

Always remember this is the equation for market movement:

Fundamentals + Trader psychology = Price

The fundamentals are actually not as important as how investors perceive them.

If you want learn forex trading, you need to get the right Forex education and work smart and you will be able to join the elite 5% who make big profits and avoid joining the losing majority. Let’s look at how to learn Forex trading the right way.

1. You are Responsible

If you think that someone can sell you an e-book or forex trading system and make you rich think again. While you can get good forex education from some sources you can’t follow it blindly.

How and why do forex prices move? The answer may sound obvious but most traders get the reasons wrong and lose. If you understand the following 3 points, then you will understand more above currency movement and get a head start in your quest for currency trading success.

So how do prices move?

Well of course they move in reaction to all the supply and demand political factors such as: interest rates, government policy, economic health and a whole host of others and these are facts but prices are also influenced by people.

As human nature repeats itself over time so do market movements and a number of scientific theories have been developed to help traders make big gains consistently and here we will look at them and how they can help you.

Let’s start with a fact

If markets were scientific then we would all know the price in advance and there would be no market – it is the unpredictability of market behaviour that makes a market move.
So if markets are not moving to a scientific theory its pretty obvious that no scientific theory will work but its not all bad news you can make money which we will return to in a moment.