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 holds around 1.0730 despite the dismal mood
Lingering inflation and growth concerns were unable to overshadow ECB officials vowing for a 50 bps rate hike as soon as next July. EUR/USD holding on to gains and en route to extend its advance.
GBP/USD rebounds above 1.2500 on renewed dollar weakness
GBP/USD has recovered above 1.2500 and managed to erase a portion of its daily losses. The dollar stays on the back foot in the American session after the S&P Manufacturing and Services PMI data both fell short of market expectations.
USD/JPY struggles near monthly low, bears await sustained break below 127.00 mark
The global flight to safety boosted the JPY and prompted some selling around USD/JPY. Retreating US bond yields turned out to be another factor that exerted downward pressure. The emergence of USD buying helped limit losses amid the Fed-BoJ policy divergence.
Editors’ Picks
AUD/USD recovers the 0.7100 helped by Wall Street
AUD/USD is a few pips above 0.7100 at the end of the American session, as US indexes managed to bounce in the final hour of trading. The Dow Jones turned positive after spending the day in the red. Eyes now on the RBNZ decision.
EUR/USD holds around 1.0730 despite the dismal mood
Lingering inflation and growth concerns were unable to overshadow ECB officials vowing for a 50 bps rate hike as soon as next July. EUR/USD holding on to gains and en route to extend its advance.
Gold bulls maintain the pressure above $1,850
Global stocks traded with a soft tone, favoring the safe-haven gold that reached a fresh two-week high of $1,869.71. The bright metal holds nearby as the American session undergoes, with Wall Street trimming most of its Monday’s gains.
Can Cardano price drop lower after losing 80% since its all-time high?
Cardano price action continues to dip lower and lower, following the broader market in a continued downtrend. Time cycles indicate relief may not come until June.
RBNZ Preview: Will they step up their tightening game? Premium
Another double-dose rate hike is on the table for the RBNZ when it meets this Wednesday to decide on its monetary policy at 0200 GMT. The central bank’s outlook on the pace of tightening, however, will be key in determining NZD/USD’s next price direction.
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