How to Trade Forex Without Forex Robots Or Signals
Wednesday, January 25th, 2012How to Trade Forex Without Forex Robots Or Signals
Article by Francisco Pizarro G.
Trading forex is very technology-centric and that makes sense. Hardly anyone places trades by calling a broker anymore and many big hedge funds and institutional money managers don’t even use live humans to trade forex.
They use expensive, automated systems that could be considered distant relatives to the forex robots and signal services that are widely available to retail traders. And since forex trading has been made available to retail traders due in large part to the evolution of technology, it’s really hard for some forex traders to imagine life without forex robots and forex signals services.
But believe it or not, forex traders found a way survive and profit in the days before forex robots and signal services became widely available. And just how did they do this? Well, as we’ve previously discussed, there are two styles of trading for any asset class and those are fundamental analysis and technical analysis. The quick description or definition of each is that fundamental traders look at metrics like volume, economic data points, commodities, unemployment, GDP and interest rates to make their trading decisions. On the other hand, technical analysts look at chart patterns.
So yes, it is possible to make money without forex robots and signal services.
How To Be A Great Fundamental Trader
Even technical traders are, at times, trading forex based on fundamentals. This usually involves trading news events and the major news events that move forex markets are interest rate decisions by central banks, unemployment news from major economic powers, GDP releases, trade balances, inflation and consumer confidence data and retail sales figures.
Fundamental trading involves a little bit more than just reading a few news clips though. Good fundamental traders dig deep to find trends that may move currencies. For example, a fundamental trader may pay attention to gold prices and look to trade the Australian dollar or Swiss franc accordingly. Or a fundamental trader may look at oil prices and short the US dollar as oil prices are on the rise. As you can see, fundamental trading involves more abstract concepts than looking at a chart or moving average. Fundamental analysis requires some sleuthing on your part.
Ready To Become A Chart Guru?
Technical trading is no more and no less important than fundamental trading. However, technical trading is a little more useful on a daily basis because there aren’t news events that are worth trading around everyday. For that reason, new forex traders to spend some time when they first start trading to learn some of the basic chart patterns that occur over and over again in forex trading. The most important chart patterns are symmetrical triangles, ascending triangles, descending triangles, the double top, the double bottom, head and shoulders and reverse head and shoulders.
If you want to be a good technical forex trader, and trust us, you do, you have to learn these chart patterns. Ultimately, you want to marry solid fundamentals with good technical analysis. That’s how you trade without a forex robot or forex signals service.
About the Author
Francisco Pizarro G. made a career from Forex and left my profession as a Translator almost 4 years ago; since then I work from home in my small office trading the Asiatic markets during night time, where I found a good niche. I am a fan of Forex Robots
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