Day Trading Why You Are Guaranteed To Lose

Day trading is popular and you will find more vendors selling day trading systems than any other method.

People buy them yet they don't work and guarantee you will lose longer term. Why?

Lets find out.

Successful trading is all about trading the odds and you must have data thats reliable that enables you to do this.

In day trading you simply dont have any reliable data to work with and therefore cannot get the odds in your favor and may as well flip a coin.

Trillions of dollars are traded daily by countless millions of traders and daily volatility is random.

Therefore, using support and resistance areas in a day session is useless.

The only people who take any notice of daily support and resistance levels are day traders and their small losing minority.

The net result is:

Day traders place stops behind meaningless levels and are then surprised when they get stopped out. Of course, even if their lucky enough to get a profit in day trading, they break one of the fundamental rules of investing:

Run your profits

Day traders are normally glad to scalp a few points or want to close out at the end of the day.

They therefore have huge amount of losing trades and their winners are tiny ensuring that their account equity is wiped out quickly.

Still not convinced?

Then try this simple test:

Ask any day trader for a real time track record of profits over the longer term and you simply wont get one.

Of course, they can produce hypothetical track records (but their done knowing the closing prices!) so they are no use at all.

People selling day trading systems make their money selling a good story and collecting money from greedy or in experienced traders, so they are guaranteed to make money while the trader loses.

Day trading sounds great in theory but although it looks low risk it is not.

You are working with data that is simply unreliable and all day traders eventually end up losing their money.

If you want to make money in online forex trading then avoid day trading.

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Forex Technical Analysis - Why it Works and How You Can Make Bigger Profits

Many traders don't understand how and why forex technical analysis works and base there trading systems on wrong assumptions and lose. Here we will show the advantages of forex charts and how you can make big profits from them.

1. The Equation for Market Movement

The equation is simple

Market Fundamentals + Human perception of = Price.

Its humans that decide the price of anything and that includes currency prices.

As human nature is constant this is reflected in chart patterns which repeat and repeat again. The fundamental news is not important by itself, its how it is perceived that determines the course of events.

Forex technical analysis simply assumes all the fundamentals will quickly show up in price action and more importantly, the forex charts will tell you how all the traders have perceived them. You are viewing the truth on a forex chart no guessing or predicting is needed, you are seeing the reality of the market price.

2. Forex Trend Following

Forex prices move in trends up or down and as the currency markets reflect the health of the economy they represent, these trends can last for weeks, months or even years.

A forex chartist doesn't care how or why prices are moving, they simply want to lock into these trends and make money from them.

3. A Game of Odds Not Certainties

Many people think prices move to some mysterious scientific theory - but they don't and there is no way of predicting where prices will go. If of course there were a scientific theory of forex market movement, we would all know the price in advance and there would be no market!

When you trade forex you are simply trading the odds - but don't let that put you off, you can make a lot of money. You're like a good poker player who passes hands by, folds losing ones and hits the big paying high odds hands.

Your trade is your hand and you should be patient, to wait for the right opportunities and not be afraid to fold or pass a trade by, until you get the right opportunity.

4. Best Time Frames

The best time frames are the big trends which last for weeks and months and the overbought / oversold areas within the trend which, last for few days to a week.

Never day trade! This is huge mistake made by many traders. All short term volatility is random and you will never win so don't try it. You can however swing trade or long term trend follow, it's a matter of choice which method you choose - both work.

5. Choosing Your Indicators

Start by using support and resistance lines and learn a breakout methodology, its timeless and it works and is covered in our other articles. Then, just add a few indicators to help you confirm your trades and your all set.

Forex technical analysis can make you a lot of money if used correctly and this means

- Acting on the reality of price change not predicting

- Using simple robust rule based system

- Being patent and only trading high odds trades

- Controlling losses with rigid money management.

When using forex technical analysis, you have a time efficient way to seek huge profits from the markets and if you can get yourself a simple rule based system which trades the reality of price change and locks into and holds trends, you can make outstanding gains.

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