Predicting the forex markets can be a challenging, yet doable thing to master. The challenge lies in the requirement of constant market analysis and consistently applying your skills. Your perception of the market will help you predict trends, find the best possible entries, and exits. So it is absolutely clear that it is critical that you understand what you are seeing on your trading monitor.
When predicting the forex markets it is important to focus both on the most recent price development/candle designs, but also to never lose track of the bigger picture. There are many tools to stay aware of both and that help you be in sync with the market. Being in sync with the market means knowing the story from front to end (or most recent developments).
The story
So what is this story? I'll try to keep it as basic as possible, otherwise it will become to lengthy an article. The more detailed version of this is taught in the elite members area of Forex Watchers and from experience I know it will take some time before traders get a full grasp of it.
The story is based on reading all the candle design that has happened in the near past. How far you go back depends on the time frame you're trading, but you need to see several swings on one time frame higher. The emphasis really is on reading the market candle by candle. What did price do at which areas, asking yourself questions like "why did it react from there and not from there?" or "how come that reaction was so strong?". It really comes down to figuring out what happened and why. Trying to do this based purely on the technical read will often give you the upper hand in predicting the forex markets and even big news events. Just remember, everything happens for a reason.
Final words
Focusing just on certain candle patterns or just on the most recent developments will leave you exposed to things you don't expect to happen. Successful trading really is the sum of all your skills and education applied to the market. So you need to educate yourself as much as you can and then use that skill set and knowledge and apply it appropriately.
#UrbanForex - Be conscious of your trading!
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Editors’ Picks
EUR/USD rebounds after falling toward 1.1700
EUR/USD gains traction and trades above 1.1730 in the American session, looking to end the week virtually unchanged. The bullish opening in Wall Street makes it difficult for the US Dollar to preserve its recovery momentum and helps the pair rebound heading into the weekend.
GBP/USD steadies below 1.3400 as traders assess BoE policy outlook
Following Thursday's volatile session, GBP/USD moves sideways below 1.3400 on Friday. Investors reassess the Bank of England's policy oıtlook after the MPC decided to cut the interest rate by 25 bps by a slim margin. Meanwhile, the improving risk mood helps the pair hold its ground.
USD/JPY rallies to near 157.00 as Yen plunges after BoJ’s policy outcome
The USD/JPY is up 0.85% to near 156.90 during the European trading session. The pair surges as the Japanese Yen underperforms across the board, following the Bank of Japan monetary policy announcement. In the policy meeting, the BoJ raised interest rates by 25 bps to 0.75%, as expected, the highest level seen in three decades.
Editors’ Picks
EUR/USD rebounds after falling toward 1.1700
EUR/USD gains traction and trades above 1.1730 in the American session, looking to end the week virtually unchanged. The bullish opening in Wall Street makes it difficult for the US Dollar to preserve its recovery momentum and helps the pair rebound heading into the weekend.
USD/JPY rallies to near 157.00 as Yen plunges after BoJ’s policy outcome
The USD/JPY is up 0.85% to near 156.90 during the European trading session. The pair surges as the Japanese Yen underperforms across the board, following the Bank of Japan monetary policy announcement. In the policy meeting, the BoJ raised interest rates by 25 bps to 0.75%, as expected, the highest level seen in three decades.
Gold stays below $4,350, looks to post small weekly gains
Gold struggles to gather recovery momentum and stays below $4,350 in the second half of the day on Friday, as the benchmark 10-year US Treasury bond yield edges higher. Nevertheless, the precious metal remains on track to end the week with modest gains as markets gear up for the holiday season.
Crypto Today: Bitcoin, Ethereum, XRP rebound amid bearish market conditions
Bitcoin (BTC) is edging higher, trading above $88,000 at the time of writing on Monday. Altcoins, including Ethereum (ETH) and Ripple (XRP), are following in BTC’s footsteps, experiencing relief rebounds following a volatile week.
How much can one month of soft inflation change the Fed’s mind?
One month of softer inflation data is rarely enough to shift Federal Reserve policy on its own, but in a market highly sensitive to every data point, even a single reading can reshape expectations. November’s inflation report offered a welcome sign of cooling price pressures.
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