Clear Your Mind and Embrace Price Action Trading
by John Arnold
Let’s be honest, Forex trading is a very difficult game and the odds are bound to be against you. Too many traders end up being stuck on the wrong side of the track because it is a 50/50 game. If your intention is to be a solid trader who makes consistent profits, then you need 3 vital attributes.
Be aware and understand everything that’s going on around you.
Have the ability to make logical decisions and controlling your emotions.
Be ruthless enough to make the most out of any advantage or edge presented you.
The successful implementation of these attributes requires focus, self-control, discipline and determination. Despite this, traders end up making things more complicated. They try to make sense of things from huge cluttered charts and a myriad of data points. Why would someone want to trade with so many distractions which are not useful? Sweep away all the noise under the carpet and streamline the workflow to leave a minimalist approach. Say hello to price action trading.
When the movement of price is analyzed across time, it can be described as price action trading. There are no complex charts or an excess of data. Everything is clear and simple. This approach allows one to trade effectively by showing how decisions and actions of various market players have modified along with the passage of time. Those decisions can be broken down and put back together like a jigsaw puzzle. The result is a series of trading scenarios which are very likely to take place.
Price action trading can also be termed as a simpler version of forecasting price. It is very easy to understand and implement when compared to other techniques. Decisions are purely based on the conclusions from analyzing price movement over a period of time. Any indicators, charts or instruments are unnecessary.
The philosophy behind this approach is to stay free from confusion. All the unnecessary noise is moved aside and the focus is completely on price movement. By removing distractions, one’s mind is better able to read price movement and make efficient logical decisions. The benefit of using indicators varies a lot. Some traders find them beneficial, but they only bode confusion for others. Trying to make sense of numerous streams of data is a complex task for even the most experienced trader. So why makes things unnecessarily tough? Remove the noise from your workflow and adopt this minimalist approach.
When the board is clean, your mind also becomes clear. And a clear mind leads to an enhanced clarity of thought and the ability to make the optimal trading decisions at the perfect time. By using the price action approach, there is a fighting chance to beat the odds. To be clear, it is not the perfect or the only approach available. But it is certainly the easiest to understand and implement. The key to heaven is not price action trading. But it is certainly a positive step in the quest for salvation.
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