Thursday, September 3, 2009

Forex Times: What Are The Best Hours To Trade Forex?


One of the biggest myths of forex trading is you need to predict where prices are going to go to win - You don’t and there is a better way to win. Many Traders believe predicting as sound forex trading advice but its not - here’s why…

The reason you cannot predict is because you are simply hoping and guessing and that won’t get you far in life and certainly not in forex trading.

Humans are unpredictable and emotional and trying to work out what millions of them might do is impossible. To win you simply need to react to price change i.e trade the reality - before we focus on this, let’s get rid of all the so called scientific theories that are sold online.

The Fatal Flaws with Scientific Theories

You have seen them and most are based around the theories of Gann, Elliot and Fibonacci. So they work? Of course not.

If forex markets did move to a scientific theory, we would all know the price in advance and there would be no market. Prices move because of uncertainty not certainty!

Also if a system is scientific, by definition it should work all the time and the above systems don’t. By definition a theory is not scientific if it’s not objective as well and the above ones are not.

So how do you win without predicting?

Trading the Truth

Quite simple really - You act on price change and wait for it to occur and one of the best ways to do this is to trade breakouts.

All major moves start from breakouts to new highs or lows and the odds favor a continuation, if the break is valid.

If you trade high odds breakouts, you can make a lot of money and you’re not predicting. You are simply waiting for the move to occur and then trading.

Most traders hate doing this, they think they have missed part of the move and want to get in at a better price and wait for the pullback.

Of course, the pullback doesn’t come and they sit and watch a huge trend develop and there not in.

Most traders simply hate missing a bit of the move and that’s why breakouts are such a great way to trade.

Don’t Look For Perfection Look to Make Money

In forex trading your not after perfection with your trading signal you will never achieve it - your out to make money and keep in mind, if you caught just 50% of every major trend you would be very wealthy!

So forget out predicting and laser accuracy with your market timing and focus on getting the high odds trades from breakouts.

Sure, you won’t buy exact bottoms, or sell exact tops - but that won’t stop you making a lot of money and enjoying currency trading success

In each typical forex trading day, there are 3 sessions that overlap and follow one after another (except in the cases where there’s a holiday for that particular region). And these 3 sessions are most commonly known as the Asian session (this is the first one that kickstarts) followed by the European or U.K or London session and then finally the U.S (American) session.

We’ll take a look at the London session this time round (check out the article on Asian session if you haven’t done so already).

The European or London session starts around 8am GMT since the eastern Europeans and the Prussians would have gotten part of the momentum going already. Every so often, you’ll see one of two patterns that emerge.

The first one would result in the market moving in 1 direction for a little while (1 to 2 hours) only to fake the market and then to do a quick round turn and move strongly in the opposite direction. These fakes are called bull head fakes or bear head fakes.

The second one is much easier to see because the market would generally not have any time to do any fakes and would quickly move in their intended direction very quickly and decisively. Each time you see the second pattern emerging, all you need to do is quickly get into it and ride on it. Never forget your stops though just in case you’re wrong about the whole thing.

Always bear in mind that you should lose little when you’re wrong but you want to make as much as possible when you’re right. That’s how you start getting yourself on the profitable side of things.

Of the 3 sessions we’ve mentioned earlier, I tend to like the European session the best because that’s where most of the trading liquidity and volume is. At the end of the day, trade whichever session you enjoy and profit from the most

Read competent ideas to online forex trading info - welcome to your personal tips store.

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