
As all traders wait to see if the most important economy on the planet can
overcome the restrictions it has imposed on itself regarding its borrowing and
start functioning again, or whether it will go ahead and default on its debt
obligations and trigger what, according to many analysts, would be as big a catastrophe
for the global economy as the collapse of Lehman Brothers, it is wise to remind
ourselves that we are always dependent on a level of volatility in order to be
able to profit from trading.
Right now the volatility index (VIX) shows that activity in the EURUSD,
the most widely traded of all Forex pairs, is at its lowest for the last six
years.
Part of Omicron Forex training and the Omicron Forex
Trading Manual is the subject of Trading Psychology. This
emphasises the need to have a stable, realistic and positive mental attitude in
your Forex activities.
One of the most important things to understand in this context is that
you can only take out of the market what the market will make available. This
can best be illustrated by imagining an extreme case, that of where there is no
activity at all - price remains the same at all times and the charts show a
straight, horizontal line. If such a thing were to happen there would be no
opportunity to make profits, period.
It is also reasonable to suggest that there are situations where the
price action, although not completely stopped, is very low. So low, in fact,
that trading opportunities are of such poor quality that they might as well not
exist. Because in addition to making small moves, such low volatility also
makes the market direction unreliable.
When these conditions are present, there is nothing, but nothing, that
the individual trader can do to change them. All he or she can do is wait.
So it is a big mistake to beat yourself up for finding trading difficult
on a low volatility time, which is what we are going through at present.
Very informative blog thanks for this.
ReplyDeletewise decision
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