Forex Myths - a Top 10 Which to Avoid Or You Will Lose!

Forex Myths - a Top 10 Which to Avoid Or You Will Lose!

by kelly Price

Most novice traders fall victim to these top 10 forex myths and if you believe any of them then you're destined to lose...

1. Forex Robot Track Records are Real

How many do you see that are? Not many most are meaningless simulations in hindsight on paper knowing the closing prices and traders wonder why they don't get rich for their few hundred dollars invested. Some robots work but always beware of the back tested track record and remember - if you go to shop they don't accept imaginary money, they accept real money!

2. Forex Day Trading Works

Well I see lots of people who claim it does but never see the evidence; normally you get a paper track record in hindsight. Fact is you cannot measure what millions of traders will do in a few hours so don't try - all volatility within a day is random and that's why you are destined to lose

3. Forex Scalping Works

Simply a more extreme way of trading than the above - lets try and assume what millions of traders will do trading a chart measured in minutes - umm.

4. You can Predict Forex Prices

Try it and you will find you are as accurate as your horoscope and its less fun. Of course, people will tell you there is a scientific theory of market movement - well if there was, we would all know the price in advance and there would be no market. Markets move because of uncertainty NOT certainty.

5. You Can Trade the News

If this is the case why do markets rally when there most bearish and collapsese when there most bullish? Simple, it's not the news that's important it's the way investors perceive it that is and the event by itself is unimportant - you need to consider markets move on sentiment not facts.

6. Complex Forex Systems Beat Simple Ones

If this is the case why do we still have the same ratio of losers to winners we did 50 years ago with all the advances in technology and forecasting? Complex systems are not better than simple ones, as they are not so robust and have more elements to break, in the brutal real world of trading.

7. The More You Trade the More You Make

Day traders and scalpers believe this and lose. Fact is the big high odds trades don't come around very often and you need to wait for them. You don't get rewarded for trading often, you get rewarded for being right with your trading signal and that's it.

8. Your Risk is Your Target Minus Your Stop

No its not - that's in your head and your opinion and nothing more. Most traders do this and most lose there is no correlation between the two.

9. Forex Trading is Easy

Easy to learn yes , anyone can do it but most lose. This is because forex trading is a unique combination of method and the mindset to accept responsibility, have confidence and trade with discipline. If you think forex trading is easy, think again. It's not and that's why most traders fail. Sure you can make a lot of money, but you need to pay your dues and get the right forex education.

10. You Can Follow Someone Else to Success

Just as in other ventures in life you cant. If a person is telling you he can make you rich, with no effort, chances are he is not telling the truth. In forex trading you have to accept responsibility, trade with confidence and discipline and you're on your own.

The above forex myths are all common and you need to avoid them, to win and enjoy long term currency trading success. So, get the right forex education, adopt the right mindset work smart and you can make a lot of money and enjoy a great second or life changing income.