Forex Fads - Popular But Will They Help You Win?

By: Monica Hendrix
Here I am going to look at forex fads and by this I mean systems methods and indicators that are popular but do they make money? So lets look at the most popular ones.

I have been a trader for the last 25 years and the ones below have all seemed to have risen in popularity with the internet. Let's look at them.

1. Day Trading

People have always day traded but it's exploded with the internet and is very popular but it doesn't work. All short term volatility is random in a day so it doesn't matter what tools you use your going to lose.

This is a great story and day trading is an adrenalin rush but doesn't make money.

2. Candlestick Charting

I used to use these back in the eighties I loved all the names hammers hanging men etc but are they really any help in trading? Not really, let's face it you don't need to see a candle shape, to know that when you have a new high and close near a new low, it's bearish.

They have a colourful history though and if you want to know more get Steve Nisons excellent books on the subject.

3. Fibonacci Numbers

These have appeared all over the net in recent years and in loads of forex trading systems.

These are like candlesticks a good story and I find it quite amusing that a theory based upon the copulation of rabbits from the 12th century is taken so seriously by traders.

Loved by the far out traders and totally useless in trading.

4. Elliot Wave

Another theory that is all over the place.

The scientific theory of market movement it boldly claims and what is it?

A totally subjective theory of peaks and troughs in any period you like. Elliot died a pauper so if he couldn't make money with it, what chance have the rest of us got?

Again the far out crowd love it - but are so stoned, they don't stop to think that if their was a scientific theory of market movement - we would all know the price in advance and their would be no market!

5. News Sources For Profit

In the old days before the internet the news was slow and out of date for most people as they got it from papers. Today though news is available in the click of a mouse and there is tons of it and very well written it is to.

The news is better but the same problems remain - its discounted instantly, you don't know how the participants will view it and much of it simply reflects the majority opinion and they lose.

6. Consult a Guru

With the internet anyone (even with no trading experience) can write an e-book and sell it and make outlandish claims and if you read some of the material presented you are going to become a millionaire for a few hundred bucks.

Some are honest and great value but most are junk relying on clever marketing appealing to greed.

People as always want an easy route to riches and the internet provides them with it but making money has never been easy and never will be.

In the days before the internet you used to rely on proper experts from the local bookstore and the good news is you can get great books cheaper than ever at Amazon.

The internet is opened up trading to more people than ever, it's cheaper, all the tools you need are free and it allows anyone to be a trader.

However just because the tools are all there does not mean more traders win - they don't.

It's still the same ratio but if you can ignore the fads and use the power the internet gives you wisely, you can pile up huge trading profits and change your financial future forever.

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