From quite a young age I used to go lake fishing. It was a pass time that I really enjoyed but was not very successful at.
Many times I would sit from dawn until dusk at the water’s edge with my rod and line poised in readiness and yet I would catch nothing at all. This never daunted my enthusiasm or enjoyment of a day at the lakes.
Getting married and raising a family gradually pushed fishing into a distant memory. Several years ago my wife and I decided to start lake fishing again. We purchased the basic equipment and set off.
As had been the case in my previous days, although we enjoyed the day, we were largely unsuccessful in terms of fish caught and yet other anglers around us seemed to have a lot more success.
I decided that something needed to change and ventured over to talk to one of the other anglers. I asked what bait he was using and he was very forthcoming about the best types of bait for certain types of fish.
On our next day of fishing we arrived armed with the very best selection of the recommended bait and ground bait to attract the fish to where we were fishing.
Once again, we were largely unsuccessful and this made me a little annoyed. What were we doing wrong? Other anglers seemed to be catching fish every few minutes.
Over the next few trips, I talked to a great many other anglers and I gradually came to understand that although we were all fishing in the same water, different anglers had different objectives. Some were fishing for Carp and so used certain adaptations to their line and used specific bait. Others were fishing for Perch and so used much longer and more sensitive poles with again, specific bait, and so on.
It became apparent that although at a first glance we were all using a rod and line with a baited hook, to catch a fish, this was not in reality all that was going on.
And this is also true with forex trading.
We are all trading the same market and we all have the same objective in that we all want to make money. Many of us may even be using the same trading system and yet some will be successful while others fail.
To have any chance of success in forex trading it is vital to be able to use the correct method to suit the market conditions. Using a method that suits a trending market when the market is flat will undoubtedly be unsuccessful.
Making short term “in and out” scalping trades when the market is fast moving and is in an established trend will certainly limit the profit potential.
Learning to read the market conditions before deciding to trade is therefore as vital, as is selecting a method that suits those conditions.
The more volatile the market, the more cautious we need to be.
It really is similar to fishing.
The fish are out there but they need to be caught. They will not just simply jump onto our hook because we want them to.
We need the right bait and the right tackle for the right fish.
We need to know what our objective is and we need to set ourselves up accordingly.
We need to know when the conditions are right and we need to be able to recognise when they are wrong, and even when the conditions are perfect we need a great deal of patience while we wait for the fish to bite.
Finally we need to know when to “strike”. Too soon and we disturb the fish and it gets away. Too late and it has eaten the bait and is gone. Our timing needs to be impeccable.
With forex trading we need the right system.
We need the right method within that system. We need to know what our objective is. We need to know that the conditions are in our favour.
We need to know when to NOT trade. We need to be very patient and above all we need to know when to strike with impeccable timing.
Forex trading, like fishing, is part science and part art.
You can purchase the science but you must learn the art.
Martin Bottomley is a full time professional forex trader, forex tutor, acknowledged author and co-developer of forex trading software including The Amazing Stealth Forex Trading system. He is featured in the forthcoming book “Talks with the Forex Masters”. You will find more information at: http://www.stealthforex.com