Hello i know most of you will be surprise on what we are going to be talking about today infant some of you will not even agree to it. Thats why i have taken today to bring you this piece of information so that you can understand why indicators lie in the financial market.
What is Forex and Forex indicators
Before we go into why indicators lie, let me introduce you all to Forex market just in case we have any beginners in the house. Forex happens to be one of the largest financial market in the world, generating about $5.3 trillion every day.
A lot of things are being traded in the Forex market such as currency pairs, stocks,bonds, cryptocurrencies, commodities such as sugar and so on , gold and futures.
Just like i said earlier on a lot are being traded in the Forex market, but that does necessarily mean that one can now buy clothes in the market or sell their groceries there.
The best thing i Like about this market is that with time and patience you can actually become a millionaire in just a couple of months as far as you get everything right at the same time you can also go broke if you are not careful, don’t worry that one shouldn’t bother you because when you are done reading this article, you will definitely understand everything and get it right.
I know right, you are just probably thinking of entering the market and making money immediately, you just need to calm down lets keep going and you will definitely get everything right.
if you want to go into the market and start making money you need to go through a broker, who will provide you with leverage that will enable you to partake in the Forex market this is because you need enough capital to partake in the market lets say like 1 million dollars.
Of course its too much right, and most of us can not really afford it that’s where your broker come into play, your broker makes your small equity to be a big money in the market, that is to say that they lend you money to enable you partake in the Forex market.
Having known what Forex is all about let us move to what Forex indicators are. Just like in chemistry indicators help you identify whether a chemical is acidic or basic, in Forex an indicator helps you to identify whether to buy or sell a financial instrument.
I know you are a little bit confused right, let me take you on a brief history of what indicators in Forex are all about. In the early 1970s, Forex was only traded by core economist and those who understand mathematics and calculations, as the world started advancing, there was need for others to partake in the Forex market too, that was when indicators were created, their job is to enable those who are not really skilled in calculations and mathematics to partake in the market too and make some profits too.
Why Indicators Lie
This brings us down to the main reason i wrote this article, am definitely believing is the same reason why you are still reading my article, why do indicators lie.
The thing is that indicators usually work with prediction but they don’t really let you know what happened in the past to enable you to really predict the future.
This means that if you are trading with indicators you are trading on probability with high risk, there is definitely every possibility that your trade might go against you.
Although there is no strategy that guarantees you 100% profit, but at least you need to be making like 80% profit in a trade.
Price action is everything in the market it tells you more about the past to enable you predict the future. My advise to you is that if you want to enjoy trading, follow price action and leave indicators.