PRICE ACTION FOREX TRADING

I am very aware that trading can become a drug and can cause addictive behavior, but I want to share with you some tips to combat becoming a "market head" lol 

Tip 1: Find other things to do that don't involve trading (Sports, Working out, Wacth tv, and something that may be the most important SLEEP!!)

Tip2: Move to higher time frames (This will move your screen time to a minimum. You will not have to be at the charts for hours on in trying to figure out which direction the market is headed. Live your life because the market will live its life with you or without you.:tongue:

Tip 3: "Trade what you see" ( I say this a lot because it is TRUE :wink:. I find that many novice traders are jumping into the market because the news was good so they anticipate the market to go a certain direction or they have a set theory in their mind about the market. Regardless of what the price movement is suggesting they continue believing that their theory of the market. So if you fall into this category relax,breathe, and learn the price action signals to look for so you can eliminate all the guess work. Let price be your guide!

Tip4: Follow tips 1 through 3  add in learn how to be a gracious loser. Because you will lose in forex. That just part of the business. Don't beat yourself up.

The slogan knowledge is power has been tweaked by none other then me. It his now been changed to "knowledge is confidence" I believe this is true when it comes to forex. I think that many traders fall victim to becoming emotionally attached to the market. One thing that a trader knows is that the market will move in any desired direction whether you like it or not. Why be in love with a market that doesn't love you back.  No but really there is a better way to become a confident trader and that is gaining a knowledge and a solid foundation for your trading. Many trader seek robots and magical formulas to eliminated the guess work of the market. But like any business you get what you put in. Why go into a war not knowing where the enemy is at and where there attacking from? You must have knowledge you MUST educate yourself. If you think that you can go into a war without a strategy then you will get chewed up and spit out, 

In order to tackle psychology of trading you must have a healthy outlook on the market and realistic expectations. You have to know that you will not win every trade. Most new traders get up when they win and down when the lose and it becomes a roller coaster ride of emotions. Rather then concentrating so much on winning every trade concentrate on managing your money. I would like to think that one common goal of every trader is to make a profit. When I trade of course I would like to win every trade but I know that is not always going to happen. Pride yourself in taking the signal and following your trading plan rather then beating yourself up over a losing trade. Just because you lost a trade doesn't mean that you are a bad trader. Give yourself credit for taking the trade for recognizing what price was suggesting and for having the guts to press the buy/sell button.

I've come up with a way to combat the feeling of being wrong or losing a trade. It's only natural to not feel on top of the world when you lose a trade. Think about it this way, if you have set your stop loss correctly if your take profit is set in a valid area and you took the signal that the market gave you, your plan was traded and if it is indeed a loser it will prove you RIGHT still because you had your stop in place and it took you out because the sentiment of the market change. So keep your head up. You win in the end because not very often will price action signals  produce LOSING trades. So learn to trade what you see and not what you think. But first you must learn to see the market and thats something that will come with added screen time and practice. 

Here is what the candlesticks represent.

Be careful trading the yen pairs. I suspect that there will not a lot a volume causing minimal movement in the market. So beware and if in doubt stay out! GOOD LUCK!!

Why trade higher time frames?

 If you have just entered the world of forex you  probably are sitting at your computer making trades watching your account go up and down like an erratic gymnast. I know I've been there. Trust me you are not alone. Many kill themselves trying to trade this way. Trading off of lower time frames is mentally and physically draining. You can literally go CRAZY trying to map the market and make solid trades off these small time frames. Instead why not keep your sanity and your account and move to higher time frames. Higher time frames mean less time at the chart WOO HOOO!!! I know it is fun reading these charts and it becomes an obsession with some but you have to live your life. 

The Advantage of Daily charts...

Daily charts eliminate all the movement that creates fear in the market. You only have to look at your charts once a day and when a setup occurs on a daily chart you take the trade, you place your stops and your take profit and you walk away. Isn't that simple enough. Many traders overlook the daily charts and it boggles my mind why. Daily candlesticks show you the emotion of price for that whole day, opposed to say a 15 minute candlesticks that show u the emotion of price for just that 15 minutes. You end up starring at the computer screen rooting for the candlestick to go in your favor like a crazed football fan. Well if you want your life back move into the world of daily charts and you will see a drastic improvement in your trading. 

http://www.screencast.com/users/KHALIF/folders/Jing/media/0e555e63-2b25-443a-b320-57cdbabea906

I don't actually trade the news but I use the news and the time they are gonna be released to enter or exit a trade. This is a site that you can use that allows you to see when important news events are coming up. The news I primarily take notice to are the news releases in red. HERE IS THE SITE

http://www.forexfactory.com/calendar.php