Forex Trading Success - Understand These 2 Equations or Lose

By: Kelly Price

Enclosed I am going to give you 2 simple equations and if you want to win at forex trading you need to understand their significance or lose, so here they are.

1. How Markets Really Move

Supply and demand fundamentals + Investor perception of the facts = Price

Well that's nice and simple!

Yes it is but most traders don't understand the significance of the equation and try and trade the fundamentals (news stories) and think it gives them an edge - it doesn't. Its how investors perceive them that's important, they are highly unpredictable and dominated by greed and fear.

Other traders think that forex technical analysis is scientific, as of course human nature is constant, they therefore think they need to predict prices but this is impossible as well and they lose.

If you understand the above you will realize that trading is game of odds -not certainties and it is investor sentiment that drives prices and the best way to win at forex is to use forex charts but not predict just follow the reality of price change.

The next equation for forex trading success is:

Understanding + Confidence = Discipline = Forex trading success

Again a simple equation but its one again that most traders fail to understand.

Trading is more about mindset than method as even if you have a good forex trading system you still have to apply it or you have no system!

The fact is you won't follow forex signals or systems unless, you understand the logic and have confidence in it. When you hit a string of losses (and you will) you will only trade with discipline if you have confidence.

Consider how many traders simply buy a forex signal service or system from a vendor and believe the marketing hype - that it will help them win or make them rich.

What happens? They all lose as they lack confidence or discipline.

Consider this fact:

Anyone can learn currency trading and anyone can win - but 95% of traders lose.

The reason is they fail to understand the significance of the two equations above.

They don't understand how and why FX markets really move or the link between method and mindset to apply it.

If you understand the above, you could be on the way to making huge regular profits.

You will realize that the way to win is based on understanding what you are doing and having confidence in it - it is simple, yet most traders just don't get it - trading success comes from within.

Forex trading offers huge rewards and if you keep the above in mind and work smart you could enjoy forex trading success.

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