As a forex trader one of your main aims should be to be consistent, in such an erratic market consistency is the key to long running success. To have any form of consistent results you need to be consistent in your approach, but not only consistent by doing the same thing, but by doing the same thing as appropriate in an ever changing market, you need to be consistent in changing your approach when the market is going from ranging to trending.
The Two Key Types Of Forex Markets.
Classically there are two types or modes that the forex market will take on, it will either be trending and heading in the same direction on a consistent basis or it will stay within a range. Depending on which timeframe you are trading off of, but ranges and trends can last for days at a time, you need to look at he market first to establish it’s behaviour, it is no good trying to trade a trend strategy when the market is ranging or employing a range strategy when the market is trending. You must learn to adjust your trading style and trade the forex market accordingly.
Becoming A Consistent Forex Trader.
To become consistent at doing something it is best to do the same thing repetitively so that you learn that particular skill so well it becomes ingrained in your mind, something that you know how to do so well becomes automatic. Now since the market changes mode it is difficult to do this, but at the start you should decide in which market conditions to trade in and avoid the other. If you mix and match your trading as the market changes you won’t be learning one skill at a time, you’ll be taking too much on, decide to trade only in trending conditions, this is much easier than trading ranges, although this might be open to debate. Whichever it is though stick to the same tools and the same types of trades, you should be using your Fibonacci tool for trending markets, but it’s not much use in a ranging market. Stochastic oscillators tend to be very good for trading ranges, but whatever you are trading,choose the right tool for the job, you do not use a hammer each time you fix a car. You also need to be in a consistent frame of mind, it is no good trading when you are under the weather or worried about something, this will cloud your judgement and even though you might even make a profit it is no good in the long run.