Foreign exchange merchants all the time harp about sustaining self-discipline and all the time following the buying and selling plan.
However whereas having self-discipline is a vital trait for a dealer, we additionally must be cautious that if we’re too caught in our methods, we’ll find yourself imposing our concepts on what the market ought to do as an alternative of reacting to what’s truly occurring.
All you actually gotta do is query the market. Actually, it’s that simple.
Why you ask? Effectively, asking questions allows you to have a look at completely different views of the market that you just initially might not be conscious of.
When questioning your market assumptions, assume outdoors the field and don’t simply keep on with easy and random questions like “What pair ought to I commerce at the moment?”
By questioning, I imply that you need to ask what the market “ought to” do in gentle of all the data – fundamentals, technicals, and sentiment – accessible at that second.
For instance, you’ll be able to ask a query like, “How will greenback merchants act at the moment given the dovish Fed assertion we noticed yesterday?”
In case you’re a technical dealer, you can even query the market by taking a look at its latest value motion.
As an example, we see that USD/JPY has been buying and selling increased for the previous few days as evidenced by its increased lows on the hourly timeframe.
You possibly can ask your self, “Is that this uptrend nonetheless obvious in increased timeframes? Has it made a brand new excessive? Will it encounter any potential resistance stage quickly?”
In case you see that USD/JPY is nearing a significant psychological deal with however nonetheless bouncing off assist at one other space of curiosity, you could choose to search for alternatives to scalp intraday tendencies slightly than swing trades. Heck, this might point out that the pair could quickly consolidate. Do you actually wish to get caught in that?
This follow will make you consider different potential eventualities that will emerge and allow you to turn into a greater “listener” of the markets, slightly an “imposer” of your personal ideas and views that in actuality, could not imply zilch to the market.
I imagine that a lot of the data we have to catch these good trades are already accessible to us. It’s simply that our biases usually make them unclear.
Studying to consistently query the market isn’t precisely scientific, however it could undoubtedly assist make us turn into extra open to the market’s prospects.
