Have you ever asked yourself why so many fail at trading forex profitably? This has been the biggest questions I needed to answer for myself before starting to trade forex. My name is Ezequiel and I am a 41years civilian contractor at the Puerto Belgrano Naval Base in Punta Alta, Argentina. I am also a forex trader and have been active in the market for eight years now. I admit that I stumbled into forex trading more by accident than anything else. I clicked on an online advertisement out of curiosity. After reading through the offer it got me thinking that I have actually made my first forex trade over 23 years ago, but not in the currently thought of way.
I was going to Spain for a semester during my second year at university. At that time the Euro was not created yet and I had to exchange Argentine Pesos for Spanish Pesetas. This was my very first forex transactions without thinking about myself as a forex trader. When I returned back home I had to exchange Spanish Pesetas for Argentine Pesos which was my second forex trade. I cannot remember if I made any money on that transaction as I never even considered to make money by exchanging one currency for another. Before I opened my very first online forex trading account eight years ago at PaxForex, I have made a few more of my old school forex transactions each time I went on vacation with my family.
Let me backtrack a bit. Before I committed to forex trading and putting my capital into the forex market, I needed to determine why the overwhelming majority fails to make money. It is important to learn what prevents most people to earn money, learn from their mistakes and develop one which will be profitable. I spend quite a few months researching in my free time and I while it is hard to pinpoint why an individual forex trader fails to earn money, it was a bit easier when looked at as a whole. Most people will trade online and either do so son their own or follow signals from others. Some are paid, some are for free. In most cases they will be provided by non-professional traders.
Therefore, it is safe to assume that the information, the material used to study trading in the forex market and the general accepted approach are the same. People researched the matter online and read the same concepts written by different people and copied from one website to another, translated and copied again. I think this is where the main problems are hidden. Here is my takeaway: learn how to trade in demo accounts, small deposits can make you a lot of money and achieving profitability is fast. In case you agree with the three facts, you may also understand why you are not profitable. All three assumptions are 100% wrong despite being accepted as the norm.
You will never learn how to trade in a demo account, it takes money to make money and it definitely takes time. You need to be realistic with your expectations, if $500 could turn into $5,000 every month you would see plenty of rich people running around. It is a great marketing gimmick and in theory it is possible, but reality looks different. I suggest that before you even open your first forex trading account, that you familiarize yourself with what it takes, align yourself with reality and then get started. I have met plenty of people who laugh at me when I tell them that I earn 25% per year. This shows me that they are either not forex traders or they lie about their performance. Let me tell you, 25% year is a great outcome and you can check what professional traders achieve which is often far less.
Now let me tell you how I achieve this and if you like my approach feel free to use it in your own forex trading account. I like to use technology as much as possible, it has been created to make our lives easier. When it comes to forex trading, there are plenty of tasks which are highly repetitive, such as analyzing charts with technical indicators. This is where I like to use EA’s, but only to analyze and not to trade. Many people fail as they want an EA to take care of everything so they can make money in their sleep. This may work for some people, but my greatest trades have been when I use EA’s to help me analyze the forex market which allows me to make a more informed trading decision.
I like to use three different EA’s as I am always looking for three trading signals to confirm a trade before I take one. Since I am using EA’s which can analyze the forex market in a matter of seconds, I am applying it on all available currency pairs. It is impossible for analysts to cover the market on their own which is why professional firms hire scores of analysts in order to get good coverage. I achieve this by using technology which is the way forward in forex trading. You can’t sit at home after work and look at a few charts manually in order to find good trades, we live in the information age and information travels fast.
Some like to focus on a few currency pairs only, which is what they have to do as they are not using technology or are using it wrong. When I tell people I analyze all currency pairs, they think I am crazy. Here is how I use my EA’s. I run the first EA to identify the trend of all currency pairs which will give me a list of bullish and bearish trending pairs. This will already reduce my list of currency pairs which I need to analyze further. I execute this on on H4 charts. I run my second EA on the H1 chart and only on those which are in my list from the first EA. I am looking for oversold conditions on bullish trending currency pairs and for overbought conditions on bearish trending currency pairs. This will reduce my list further and often down to less than 10 currency pairs.
Finally I use my third EA on the M15 chart where I am looking for entry opportunities into my list of currency pairs for the day. I am looking at support and resistance levels. Those currency pair which showed me bullish trending on H4 with oversold conditions on H1 will be bought at support levels and those which showed me bearish trending on H4 with overbought conditions on H1 will be sold at resistance levels. In order to make this process more focused, I have three monitors and run the MT4 trading platform on each of them. On one screen I have the H4 EA, one another one the H1 EA and on the last one the M15 EA. I have them connected and an intermediary between the EA’s which communicates which currency pairs are in the list. I hired a computer scientists for a few hours who created this communication tool for me which was my best forex related investment ever. You can work without it and write down everything in a spreadsheet until you earn enough to upgrade! This is how I earn a second income every month right here ta PaxForex, give it a trial and contact me in the comment section if you would like to know more information about my Tech Savvy FX Strategy!