Hello, I am Samantha from Ireland. I am computer scientist who is fascinated with math and science fiction. I love math as it explains just about everything on this planet and science fiction is just a fun way to relax. During the day I work for a security firm, developing new cyber security tools for government and corporate clients, but at night I turn into a hardcore, part-time forex trader. Why do I love forex? It goes back to my obsession with math and therefore financial markets are a great playground for people like me. I settled on the forex market due to its daily turnover which simply intrigued me.
Forex trading is rather simple. I don’t mean that it’s easy, but it’s simple. I think a lot of traders try to overcomplicate the entire approach to forex trading and find themselves entangled in a web of data and information which would confuse the most seasoned professional trader. I like to break things down into logical segments which helps me filter through the noise and I can only suggest others to try the same. It applies to everything in life, not just trading forex. When you look at the big equation, it often makes no sense but once you drill down and look at the pieces a much clearer picture appears.
Everyone knows that when it comes to financial markets, there is plenty of “noise”. This refers to news reports, economic data points, interviews, tweets and other social media hype, political developments and global economic flows. In order to become a successful forex trader, one needs to be able to filter through this noise in order to understand what will impact price action of each currency pair. It is easy to jump an a popular trade, but when it comes to trading, the majority is usually wrong. The “noise” has left many forex traders will losses and missed opportunities, wrong and early exits and plenty of frustration.
Instead of focusing on a trading strategy, I recommend that the start for each forex trader is the filtering of “noise”. Let me put it this way, when you have a lot of data to sort through, but you know that 90% of that data is not relevant to you don’t want to waste your time analyzing it. You will apply filters to make sure you have only the data you need and then you will analyze it further. Approach forex trading the same way, don’t just rush into anything because someone told you it is relevant. Those who don’t filter the data, get stuck with the “noise” and waste their time analyzing material which is not beneficial to them.
Now let me explain why I believe forex trading is simple. You analyze, you trade, you profit and you repeat. Four very simple tasks once you break them down. The most difficult part is the analysis as all others aspects depend on it. Learn to filter the “noise” first and then decide if you prefer a fundamental analysis, a technical analysis or a combination of both. In my opinion it is very important to understand both as they will impact your trades. First I filter through the data and find the forex trades which I fundamentally like to trade, then I use technical analysis in order to find the proper entry and exit levels.
When it comes to price action moves, irrelevant if they were caused by fundamental factors or technical ones, usually always reverts back to the mean trend. What I mean by this is that there will be price spikes and drops, another form of “noise”, but eventually the price will move back to its mean trend. It is therefore very important to determine this trend, understand it and trade accordingly. It is also very important to understand what caused the diversion from this trend as it may have an impact longer-term. Trends are great, but they do get broken as well which makes the understanding of events that much more crucial.
Now if you have some problems finding the right analysis, PaxForex offers a range of trading signals you can use. I trade my forex portfolio at PaxForex for over six years now and I had a rocky start. This is normal as you apply something new to an unfamiliar topic. I like to take the trades recommended by PaxForex and then use my “Mean Trend Strategy” in order to use the right lot size. I only take trades which fit my own strategy and ignore those who are contradicting it. It does not only give me a second opinion and double verification from a trusted source, but my profits have risen fast since I have executed this combo approach to forex trading.
This has really helped me a lot when it came to understanding the forex market and how I rose from an unprofitable part-time forex trader to one who makes enough on the side to pay her bills. I hope you will have a similar story to share. Forex trading is really a lot easier than many want you to believe, but it will take some time to understand how to put the pieces together. In math you need to solve an equation and the same holds true for forex trading. The great thing is that once you have solved it ones, you will have no problems to repeat it time and again. Happy trading everyone.
