Skill vs. luck in Forex trading

How is Forex trading like (skill vs. luck)

  • 10 (like chess)

    Votes: 13 32.5%
  • 9

    Votes: 2 5.0%
  • 8

    Votes: 8 20.0%
  • 7

    Votes: 5 12.5%
  • 6

    Votes: 2 5.0%
  • 5

    Votes: 1 2.5%
  • 4

    Votes: 1 2.5%
  • 3

    Votes: 1 2.5%
  • 2

    Votes: 1 2.5%
  • 1 (like slots)

    Votes: 6 15.0%

  • Total voters
    40

Atilla

Legendary member
19,910 3,163
Please elaborate.

I hope it is more than just monitoring the economic calendar, watching bloomberg or receiving Reuters feeds.

That's a good start but there are few more checks to tick off.

1. News- need to definitely keep abreast of the news and what happens overnight in the Asian sessions. Key ones being jpy, aud, oil, gold, silver. Compare moves between major pairs. Not just read this stuff but try and appreciate what it means to your currency pair.

2. Technical charts - if you look at the technical charts starting from long time frames - monthly and then drill down into smaller time frames you will see and feel for the movement and note strong S/R levels.

I think Fib retracement on longer time frames are significant levels and coupled with pivot points should provide a good indication for placing targets and stops.

You should also view the Trading Range of the last 'x' time frames that you use for holding your trades and be aware of the volatility of your currency and it's price range.

Here is a really good site imo on FX correlation. https://www.mataf.net/en/tools/01-01-correlation

Compare the currency index and you can observe changes between the pairs based on correlation and historic movement make an informed decision on diversion.

Here is another http://www.investing.com/ .

3. Fundamentals - there is the news and applied economics - knowing the effect of news eg: difference between real and nominal interest rates, inflation, BoP etc., should help digest what's going on in the markets and currency flows.

There is shed loads of work to do here and material to go through but each to their own. I'm not saying this is all of it but what I learnt as being relevant in my approach to forming decision on direction.


Being an economist graduate I thought I knew it all and it cost me quite a sum of money learning I didn't.

I've learnt more from numerous people providing free opinions on this site then I did at uni and now in the process of clawing back slowly what I lost rapidly.

The more work and effort one puts in then the more one will understand the instruments and tools one uses in deciphering the moves. In fact it is more important to understand and fathom out why the market has moved against you then for you.

To call it gambling / luck is an indication one is not taking this business of investing seriously. imo - It's lazy speel for I don't know what I'm doing.


I like the humbling way put by others; harder I work the luckier I get.

I wonder which part of that statement lingers on the mind of the reader?

- He worked hard
- He got lucky

:?:
 
  • Like
Reactions: Forexmospherian

IzaIza

Member
53 2
Well explained Atilla. Credit is well deserved.

To each their own, I suppose.

There is many ways to trade, I hope you have found one that suits you.
 

IzaIza

Member
53 2
This is why I was hesitant to put money in forex... I just don't know what to look at to give you a better advantage, it's all like blackjack to me..

Don't know how to follow the news since it's a whole country & besides brokers will flag you if they find out...

I don't like putting my money in things unless I'm pretty certain of a profit...

That is an excellent plan, do not invest unless you are certain.

I would just like to iterate that there are many traders that are quite successful without following the news whole. There are economic calendars you can keep track of as well as indicators or alarms that will alert you prior to figure release.

Perhaps you should look into technical analysis, it is somewhat similar to playing a blackjack hand "by the book". (Your own book.)

I have an indicator that alerts when anything is coming up on the economic calendar. I monitor my trades closely to confirm my suspicions are correct.

May the luck be with you
 

MistakesWereMade

Junior member
47 2
That is an excellent plan, do not invest unless you are certain.

I would just like to iterate that there are many traders that are quite successful without following the news whole. There are economic calendars you can keep track of as well as indicators or alarms that will alert you prior to figure release.

Perhaps you should look into technical analysis, it is somewhat similar to playing a blackjack hand "by the book". (Your own book.)

I have an indicator that alerts when anything is coming up on the economic calendar. I monitor my trades closely to confirm my suspicions are correct.

May the luck be with you

I've studied technical analysis but mostly for the stock market.. It's works a little different in the forex I believe.. I don't have the enthusiasm really to play the forex.. I just don't like how numbers move so slow (regardless of leverage) and it's not as dynamic as the stock market.
 

darktone

Veteren member
4,016 1,084
Its all to do with luck.

Was luck that I stuck around long enough to realise that i dont know sh!t.
Good fortune to eventually realise that I dont need to know sh!t.
Sheer luck that I had a friend wake me up to the importance of psych. (that was fortunate actually :cheesy:)
Complete fluke that I faded that 5min chart... Inline with the h4... And actually made some money.

Thank f**k for luck!
 
1

12WBT

0 0
Its all to do with luck.

Was luck that I stuck around long enough to realise that i dont know sh!t.
Good fortune to eventually realise that I dont need to know sh!t.
Sheer luck that I had a friend wake me up to the importance of psych. (that was fortunate actually :cheesy:)
Complete fluke that I faded that 5min chart... Inline with the h4... And actually made some money.

Thank f**k for luck!

Come on mate.
There must be some skills hidden under that psych.
 

darktone

Veteren member
4,016 1,084
Come on mate.
There must be some skills hidden under that psych.

I dunno mate, what skills do we really need?

Physical:-
1) be able to turn on puter and login to platform.
2) be able to press button on keyboard so as to enter an order.

Method:-
1) be able to define an opportunity.
2) be able to act on that opportunity.

Psychological:-
1) being able to understand what drives my emotions.
2) being able to identify what drives my emotions.
3) be able to use tools that deal with my thoughts that threaten action in physical and method.
>>>>>
573) understanding that most participants are victims of their thoughts / beliefs and emotions.
and on and on and on :sleep::sleep::sleep:

Whats the the one skill set that gets neglected by nearly all participants?


Ps:- The luck comment, i was as they say. Takin zee p!ss. But luck does play a part imo. Like when you take your amazing self to the market, and it knocks you out the ground with an unprecedented situation/s. Not batting a f**king eyelid.
Bad luck old chap! ;)

Or when your take your incredibly unprepared stupid feckwit of a self, who knows even less than nothing to the market, land long at the beginning of a bull market.
:LOL:

But who knows, not me. :p
 
  • Like
Reactions: 12WBT

Atilla

Legendary member
19,910 3,163
I dunno mate, what skills do we really need?

Physical:-
1) be able to turn on puter and login to platform.
2) be able to press button on keyboard so as to enter an order.

Method:-
1) be able to define an opportunity.
2) be able to act on that opportunity.

Psychological:-
1) being able to understand what drives my emotions.
2) being able to identify what drives my emotions.
3) be able to use tools that deal with my thoughts that threaten action in physical and method.
>>>>>
573) understanding that most participants are victims of their thoughts / beliefs and emotions.
and on and on and on :sleep::sleep::sleep:

Whats the the one skill set that gets neglected by nearly all participants?


Ps:- The luck comment, i was as they say. Takin zee p!ss. But luck does play a part imo. Like when you take your amazing self to the market, and it knocks you out the ground with an unprecedented situation/s. Not batting a f**king eyelid.
Bad luck old chap! ;)

Or when your take your incredibly unprepared stupid feckwit of a self, who knows even less than nothing to the market, land long at the beginning of a bull market.
:LOL:

But who knows, not me. :p


There is a lot of personal luggage here :rolleyes:


139827367-homeless-person-in-manhattan-new-york-city-u-gettyimages.jpg
 

Atilla

Legendary member
19,910 3,163
This would be so much better, don't you think?

FFA18N3FQMXFDE4.MEDIUM.jpg
 
  • Like
Reactions: darktone

darktone

Veteren member
4,016 1,084
This would be so much better, don't you think?

FFA18N3FQMXFDE4.MEDIUM.jpg
Well you can only drop the luggage if you realise youre carrying it no? So in a sense, that pic represents me :)
Most folks be hauling a sack full of crocodiles, yet be blissfully unaware. To busy trying to find the most skillful way to hit boots on floor! :LOL:
 
  • Like
Reactions: Atilla

louistrader

Junior member
46 3
The skill is all stuff that is unrelated to the market. The skill is in mastering yourself by proper risk management, position size, etc.
 

kwickwool

Well-known member
291 30
Statistically luck can only take you so far and the law of averages state over and above a certain number of trades that the luck will even itself out and it will be the skill of the trader that ultimately is what makes you profitable.

And finally, flip a coin on your trading decisions and u will be right 50% of the time(not quite right but u know what I mean) and all you are looking to do however u trade is increase the probability of being right in your favour, however u do that either with news, technical analysis etc etc

And then it does get to a number of trades where luck no longer is statistically valid and it is down to your trading........
 

Vinayak1000

Junior member
38 1
It's definitely skill that is needed for forex trading success. The skill inevitably creates the luck. There is a lot to learn in forex trading from the fundamentals to the technicals. After all, forex trading is risky and it is much more likely to lose a lot of money due to insufficient knowledge than to make good profits.
I had to do a lot of demo trading before I started live forex trading. And still I am not that comfortable as the markets are tricky and can move in any direction. Its always best to follow the market rather than be contrarian.
 

IzaIza

Member
53 2
"The skill inevitably creates the luck."

Wow. I have to say you are spot on Vinayak1000. No sarcasm intended.
 
 
AdBlock Detected

We get it, advertisements are annoying!

But it's thanks to our sponsors that access to Trade2Win remains free for all. By viewing our ads you help us pay our bills, so please support the site and disable your AdBlocker.

I've Disabled AdBlock