You’ve probably heard many times the above quote and if you are a beginning trader you are most likely questioning what does it mean. Also, it is worth to mention that there are a lot of forex traders with experience that also do not know to apply it effectively. This article will explain to you how to go with the flow in order to be able to be one step ahead towards success in the forex market.
Are traders really going with the flow?
Most of them – not at all. And that is because most traders do not understand what is this all about. One of the key lessons traders need to understand is that it is highly crucial to trade in the dominant market direction. No trader can control the market so you have to trade in the direction of the majority. However, simply going long when the market is trending up won’t guarantee success. Going with the flow does not refer to only direction. The entry location and timing represent two other details you should take into account in order to trade in the direction of the dominant trend effectively.
Source: https://glamurp.blogspot.ro/
Since trading forex requires you to trade leverage, you need to take precautions so your trading account won’t go into the negative. Small price changes can hurt badly your trading account, especially you are using a big leverage. By focusing on the timing and entry location, not just direction you will be able to optimize your trading methodology and manage to get better results.
Is very easy to find the dominant direction, but finding the best timing and the best entry locations require some skills and that is why most traders fail. Practice and study is required here, so you need to dedicate yourself in order to learn how to do it.
We hope our article helped you understand better what “Go with the flow” actually means. Keep in mind that timing and entry location are as important as determining the dominant direction of the market. If you manage to master these skills your performance will definitely improve substantially.