Uk forex daily commentary

The Authority’ on Price Action Trading. In 2016, Nial won the Uk forex daily commentary Dollar Trader Competition. As any consistently profitable trader will admit, it takes a consistent conscious effort to hit big winners in the market.

The psychology of holding a trade A simple fact of trading, is that if you want to make a lot of money, you’ve got to have the mental fortitude to hold trades for longer than you might be comfortable with. Most traders do very well on a demo account before they go live. Think back to when you were on demo, or maybe you’re on demo right now. I’m willing to bet you’re holding trades for a few days or a few weeks even, and you’re not interfering with them very much. On a demo account, traders tend to be less-involved with their trades because they simply don’t care that much since there’s no real money on the line. The end result, is that they stick with their original trade idea most of the time. This is the main reason why people tend to do very well on a demo account.

Thus, traders often do very well on demo for the reasons just discussed, then they get all psyched up to start trading live and open a live account. Trading might be the world’s most rigorous test of one’s mental discipline and strength. In the face of a trade that’s moving against you and in negative territory, how will you react? Conversely, in the face of a trade that is up a nice profit, but has not yet hit your target, how will you react? Closing out a trade for a small loss, before it hits your stop loss, is an example of letting fear control you, and doing so directly limits your profit potential because you’re not giving the trade proper time to play out and you’re also voluntarily taking a loss.

Closing out a profitable trade too soon can also be detrimental to your overall trading success. Remember: Anything you predefine, before entering a trade, is going to be more logical and objective, and thus profitable over the long-run, than any decision you make whilst in a live trade, under the influence of your hard-earned money being at risk. The POWER of simply sitting on your hands and doing absolutely nothing whilst in a live trade, cannot be over-stated. Your true power and advantage as a retail trader, lies in your ability to remain patient and in control of your behavior in the market. In the current market environment, trades are taking longer to unfold and this market is designed to shake you out. There is a lot of volatility within the price swings lately. The chart below shows a couple of recent trades in the spot Gold market.

The first, was a pin bar sell signal that we discussed back in our August 11th commentary. The next signal in the Gold chart above was an inside bar sell signal, we first discussed this signal in our members daily trade setups commentary. The next example we are looking at is a recent fakey pin bar combo trade on the USDCAD daily chart. The main thing to note here is that price initially popped higher from this signal, triggering many traders into the trade, then over the next two days it began falling again, probably bringing anyone long into negative territory.

In other words, give your trades a chance to play out in your favor, stop prematurely closing them before your stop loss is hit, just because you are afraid of absorbing a full loss. You should always predefined what you’re comfortable with potentially losing on a trade, and just accept that as the cost of doing business in the market. However, if you cut your trade before your original stop loss gets hit, you’re not letting your trading business have the proper room it needs to grow. One 3R winning trade will pay for three 1R losing trades. Therefore, when you cut a potential winning trade out of fear, let’s say that trade would have been a 3R winner, you are voluntarily giving up more than 3R in profit! This is just not the proper way to trade.

It’s not how you catch big moves in the market and hence, it’s not how you build your trading account or become a pro trader. Learn to trust your trade and trust your gut. If you don’t learn trust to your trade decisions and see them through, you will never make consistent money over the long-run in the market. Closing trades early guarantees a loss, don’t ever guarantee yourself a loss in the market unless you really have to!