Do you have market conditions that you just hate?
Maybe the trend is your friend, but your trading gets all in a knot during range bound markets.
But what if you could transform the market conditions you hate into the ones that you love the most?
I went through this exercise myself, and now the conditions I used to dread are my favourite set-up.
Stop trying to perfect what you are currently doing
If what you are doing is not working all that well, then it’s time to start thinking outside the box.
Put aside the indicators you have been playing with to build your trading strategy. Instead, bring up a chart and look for your least favourite part.
Perhaps choppy range bound conditions get you all flummoxed.
Or you lie awake at night sweating over fast moving markets.
Whatever is your bane is where you want to go.
When you have identified your enemy, start to ask yourself these questions about the market conditions:
- What is it you don’t like?
- Why does your strategy not work?
- What trading approach will work?
- How would you need to trade to start LOVING them?
- What low risk/high reward opportunities can you spot?
- What are your risks and how can you mitigate them?
This will force your creative brain to work overtime. (Despite first impressions, trading involves a large degree of creativity – I smell an upcoming post on this topic)
It is also going to force you to start seeing the market differently. It’s all lines on a chart, but traders see it in so many different ways. If your model of the market is wrong, this exercise will help you correct it.
Have fun with this exercise. Try and see if you can figure how to pick tops and bottoms if you are a trend follower. Or to buy pull-backs if you are a contrarian. Let go of the shackles of your previous experience and see what happens. You might be very surprised at the results.
About the Author
Sam Eder is a currency trader and author of the Definitive Guide to Developing a Winning Forex Trading System and the Advanced Forex Course for Smart Traders (https://fxrenew.com/forex-course/). He is a key team member at premium FX services provider www.fxww.com and part owner of Forex Signal Provider www.fxrenew.com (You can get a free trial). If you like Sam’s writing you can subscribe to his newsletter for free (https://fxrenew.com/newsletter-sign-up).
This post was first published here.