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 pulls back from one-month high
EUR/USD has backed off from one-month highs reached during the early Asian trading hours, possibly tracking signs of nervousness in some of the Asian markets. Risk assets remain vulnerable to Sino-US tensions despite the coronavirus vaccine news.
When are the UK CPIs and how could they affect GBP/USD?
GBP/USD eases from intraday top of 1.2587 while defying the previous two-day losing streak. The pair’s recent gains could be attributed to the increasing hopes of further stimulus from the UK government as well as broad US dollar weakness. Focus on UK CPI data.
USD/JPY holds steady around 107.25 on BOJ's status-quo
USD/JPY shows little reaction to the BOJ's status-quo on the monetary policy decision and downbeat quarterly outlook report. The spot also remains unfazed by the risk-on rally in the Asian equities amid coronavirus vaccine hopes.
Editors’ Picks
EUR/USD pulls back from one-month high
EUR/USD has backed off from one-month highs reached during the early Asian trading hours, possibly tracking signs of nervousness in some of the Asian markets. Risk assets remain vulnerable to Sino-US tensions despite the coronavirus vaccine news.
When are the UK CPIs and how could they affect GBP/USD?
GBP/USD eases from intraday top of 1.2587 while defying the previous two-day losing streak. The pair’s recent gains could be attributed to the increasing hopes of further stimulus from the UK government as well as broad US dollar weakness. Focus on UK CPI data.
USD/JPY holds steady around 107.25 on BOJ's status-quo
USD/JPY shows little reaction to the BOJ's status-quo on the monetary policy decision and downbeat quarterly outlook report. The spot also remains unfazed by the risk-on rally in the Asian equities amid coronavirus vaccine hopes.
BOJ Preview: No changes in policy, but forecast downgrades expected
After a chaotic end to Q1, the Bank of Japan is back to usual business. Policymakers will have a meeting to decide on monetary policy early Wednesday.
Gold: Bulls gather pace for further upside
Gold consolidates the recent pullback well above the $1800 mark, as the coronavirus vaccine hopes boost the equities and downs the greenback. Are gold bulls bidding up for a test of the multi-year highs?
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