Feeling the Forex Market Prediction Champion? Watch Out!
When a trader feels that he has enough experience in the world of forex trading , he will be vulnerable to “arrogant disease”. He began to believe that he really could predict exactly where prices would move. He felt arrogant, feeling at the top of the world. “Disease” is really very vulnerable to attack anyone who has been in the world of forex trading for years. Moreover, it turns out that the majority of the analysis he made turned out to be valid, so that there were several institutions such as forex brokers and / or trading analysis service providers interested in utilizing analytics services from him. Let alone the “veteran forex” and succeed, the beginner and dimly crushed are often attacked by “disease”; even worse. Ironically indeed.
This “feeling great” disease often leads a trader to think that he really knows every inch of market movements. This kind of assumption – unfortunately – it’s dangerous because it can make a forex trader feel like a “Trading God”. The person with “God Trading Syndrome” has some kind of confidence that he can really predict where prices move without ever missing out. In his mind he DEFINITELY WOULD BENEFIT. In this situation, he really felt he could eliminate the possibility that he could make a mistake.
But unfortunately in reality no trader can eliminate the element of uncertainty in the forex market. Uncertainty has become the character of every form of business; that is what is called risk. No one can provide predictions that are 100% accurate about what will happen in the next market. Again: NO .
Prediction 100% Accurate? Ah, don’t dream!
Trying to predict market movements is like trying to predict the future. I am sure you will agree with me: no one can KNOW EXACTLY what will happen in the future, even in the next five minutes .
It is still fresh in my memory, when I speak at a forum about human inability to predict exactly what will happen next. A few minutes later a “small accident” occurred: a glass of water spilled on my laptop.Obviously, I didn’t know before that it would happen. That’s the risk.
As a trader, if you insist on having “supernatural talent” who can predict the direction of the next market and stubbornly rule out every possibility that exists, then be prepared to face adversity.
Of course we are not talking about the ability of an experienced trader in recognizing market behavior. In technical analysis we believe that “history repeats itself”. History is always repeated, in the sense that market behavior has been proven historically to be repeated. That is why we can learn and use – for example – candlestick patterns, price action and the behavior of technical indicators. From such studies and observations we can then estimate where the price will move.
Possibility Is Not Certainty
Now, this is the key word: “possibility” . Estimating the potential for DIFFERENT price movements by feeling arrogant can predict where prices will move. This “probable” model approach then makes a forex trader take cautious steps and anticipate by installing a stop loss. He will also set his capital with position sizing . Even if he experiences a loss, he will receive it gracefully and then will evaluate the trading strategy used. This is what a trader who has a “God Trading Syndrome” will never do.
People with “God Trading Syndrome” are very likely not to take action to anticipate risk. For what, if he feels he will always be right? Even if it turns out he has suffered a loss, he will stubbornly blame the market (this part is always the most ridiculous) and does not want to evaluate the trading strategies he has.
Focus on the process
As a trader, you should not try to predict, but “read”. What is read? Of course is the current market behavior and situation, to then take the necessary strategic steps and anticipation.
Like driving a car, when you want to overtake the car in front, you should not assume “there must be no vehicle in the opposite direction”.Conversely, what you have to do is observe whether in the opposite direction there is a vehicle that is running? If not, please drive your car to overtake. If it turns out, observe again: does the vehicle go fast? If so, you should delay the intention to overtake. Ridiculous and silly if you insist “nothing will happen” then desperate to overtake, while many factors are very possible for “nothing to happen”.
In trading, the thinking pattern as above is a process of minimizing risk.Is there a valid trading signal? Is the position to be taken in accordance with the trend? Are the lots to be transacted in accordance with the capital strength? Is the stop loss limit not too large? Is the profit target realistic? Etc.
This process is most likely ignored by people with God Trading Syndrome. “Ah, there is no need, later, it will also be profitable,” he might have thought. If you think like that – sorry to say – your forex trading career doesn’t seem to be long.
Maybe now there is a person with “Trading God Syndrome” currently laughing at this article and making all kinds of apology and justification.It is okay. My task is only to remind. Hopefully accepted.