Trade Forex Like a Sniper…Not a Machine Gunner
Today’s Forex Lesson is “Absolutely Freaking Awesome”.. Seriously! In fact, It’s probably one of my best trading lessons I have ever written. It took me at least 2 days of brain power and probably 20 coffees. So for my efforts, I am going to ask a small favor here. please make sure you leave a really cool comment, AND also SHARE it on facebook and twitter, and if you really enjoyed it, post it on some forums and spread it around to your trading friends. All I ever ask is for you to pay it forward, share it with others and always leave a comment on my articles and videos. If you don’t do it, you should feel very very guilty.. (only joking : ). Enjoy today’s lesson and good trading as always, – Nial.
A sniper in the military has an edge over his or her enemy; their edge is unwavering patience, mastery of their weapon, and the ability to remain consciously in control of their mind and body for long periods of time in high-stress situations. We can apply these same concepts to Forex trading…
Forex trading is very similar…you need a trading edge (weapon), you have to master this edge, you need to develop and maintain rigid self-discipline and control, and you have to execute your edge flawlessly in the face of constant temptation to over-trade and over-leverage. Now, trading is nowhere near as stressful as war, but it still requires conscious control of mind and body.
Those traders who learn to pick and choose their trades wisely, trading like a Forex “sniper”, are typically the ones who succeed long-term, whereas those traders who act like machine-gun traders by shooting at everything they see (trading too much), tend to run out of ammo (money) very quickly and fail to accomplish their goals in the market. Let’s discuss how you can learn to trade like a sniper instead of shooting at everything (taking every trade) that
comes your way…
– Accept that less is more in Forex trading
One of the things that we traders can learn from a sniper in the military is that in certain situations less is indeed more. Forex trading is definitely a “situation” where less is more. However, it is very common for beginning traders to feel that more is better; more Forex indicators, more trades, more analyzing, more money on useless trading robots, etc.
What is the result of such misinformed beliefs? The result is almost always over-trading; indeed, most beginning Forex traders are like machine-gunners; spraying bullets (money) at everything they deem to be a trade and likely causing more damage to their trading accounts than good. The first step that you need to make if you want to trade more like a sniper and less like a machine-gunner, is to truly accept that less is more in Forex trading.
Just like a sniper waits patiently for his or her pre-determined target to come into view; you need to learn how to wait patiently for your pre-defined trading edge to show itself in the market. As price action traders we have a very effective trading edge that allows us great opportunity to trade the market with sniper-like precision, and the daily charts provide the best “battleground” for us to execute our edge on.
– Higher time frames
As I mentioned previously, the daily chart should be your “battleground” for developing your ability to become a Forex sniper. Why, you ask? Because it is the daily chart that gives us the “highest value” or highest-probability targets when compared to any time frame below it.