There can be many reasons why so many beginning forex traders experience difficulty and frustration when first starting to trade. Forex trading is an intensely psychological profession that requires objective thinking at every level. Many traders start out by trying to find a trading system or method that will give them exact entry and exit signals so that they do not have to think or train themselves in how to read a price chart. The fact is, the forex market is constantly moving and this movement cannot be predicted with any degree of accuracy by a rigid system that employs lagging indicators or other such nonsense. Learning to analyze raw price action on a stripped down price chart with no messy indicators is the most relevant and adaptable way to analyze the forex market.
Market conditions are not static, as such; we need a method that allows us to make sense and use of ever-changing forex price movement. Price action analysis will allow you to use specific price setups that occur within the context of a trending or consolidating market. It gives you a way to read a price chart it was supposed to be read; with just plain vanilla price action. Many forex trading problems arise when traders believe if they could just analyze more information or get a better system or read more books on trading methods they will become profitable. The key to forex trading lies in believing in the fact that your success or failure ultimately depends on how you think about the market and how you manage your reactions to price movement, in other words, its mostly psychological.
This is exactly where the real benefit to price action analysis comes in. With regards to helping to fix psychological mistakes that are so often caused by lack of an effective trading method or self-doubt, price action trading can give you a highly relevant, simple, and valid trading method that will give you the power to find numerous profitable signals and trade in a very straight-forward and clear manner. When you begin to simplify every aspect of your trading plan, starting with the method you are using, you begin to think more objectively and see the market for what it is; price movement over time. When we become trained in how to spot specific, highly profitable, price action setups we realize that over-analyzing economic data and numerous indicators is only hurting our bottom line and frustrating us, thus causing more psychological problems.
Most forex marketers or people trying to sell you a trading system or course will not tell you that the method you use can be simple to understand and only needs to make use of price action setups. This is because the business of selling scam forex products that are little better than chance is very profitable for some people. Fortunately there are a handful of honest forex educators out there who are genuinely concerned with putting out a high quality product that is also effective and continuously relevant. The method of price action analysis is an inherently simple yet effective method to trade forex, finding a mentor with a knack for teaching price action but that also happens to be a professional trader can be a huge step in the right direction towards eliminating your forex trading problems.