Currency Trading - This Equation is Vital to your Currency Trading Success!

If you want to enjoy currency trading success then you need to fully understand the formula enclosed and the fact is most currency traders don't. The equation is the one for market movement and why prices move and here it is:

Fundamentals + Investor perception = Price

Nice and simple ...on the face of it yes but most traders don't understand it and if you believe any of the comments below you have not understood it correctly:

- I can make money predicting currency prices in advance.

- Day trading is a great way to make money.

- Markets move to a scientific theory as human nature is constant.

- I like to trade the news and listen to experts.

Do you believe any of the above? Then you do not understand the equation.

Firstly human nature is constant but does not move to a scientific theory as we are creatures of emotion not logic. We all have the same facts to look at - but we all draw subjective conclusions from what we see and millions of traders do this every day to create a price.

There is no scientific theory of course and if there were, we would all know the price in advance and there would be no market!

You can't predict forex prices - it's simply another word for hoping or guessing and that won't reward you in any venture in life let alone forex trading.

Day trading doesn't work because the time span is to short and you can't predict what humans will do in a day or a few hours - you need more data.

Finally the news won't help you as it's the trader's view of the news that's important - NOT the news itself.

It's a fact that markets tend to collapse when their most bullish and rally when their most bearish, so trading news stories is a mugs game. Great stories but no help in trading.

The Way to Enjoy Currency Trading Success

Is simple use forex charts and trade the reality.

You don't need to predict you can see the price and act on when the event occurs. You don't need to follow the news because in today's world of instant communications all fundamentals are instantly discounted in the price.

Forex charts however give you something more - they tell you how the participants see the facts and help you study human psychology.

So you can study the fundamentals and human psychology all at the same time.

You can then spot high odds trades.

It's a fact that most price spikes caused by human psychology are temporary, prices eventually return to fair value and these spikes are easy to spot with a forex chart.

Forex charts allow you to trade the reality of price change.

You don't care how and why prices move you just want to enjoy currency trading success when they do.

If you understand the significance of the equation now, you can apply it to your forex education and start seeking some great currency profits.