FX TRADING STRATEGy
Why especially Forex? Good question – and the following article is our humble attempt to provide an answer. Please understand that my answer is an opinion, held by yours truly, and is served up with few statistical facts that would support our conclusions.
Any competitor will likely tell you that to compete at your best you must know your competition.
Who do we compete with when
we trade Forex?
From the volume and size of the typical Forex market one might
Forex appears market we to be have affected ever by
the prevailing trend more than any
traded think
that we are competing with just about everyone else in the whole world! Obviously, that is not true, but there are a great many of individuals, a large number of institutions – and even some machines.
From our previous experience 66 FX TRADER MAGAZINE April - June 2013
However, we strongly suspect that Forex has a significantly larger number of machines at work than most other markets.
Why do we think this to be the case? Our short answer is trend – Forex appears to be affected by the prevailing trend more than any
short term traders.
Secondly, the institutional traders, while significant in number, are far fewer than the individual traders. We suspect that a significant number of institutional traders use a computer program to guide their trading decisions. These
trading other markets, especially
futures contracts, we are accustomed to facing competition from a large number of individuals as well as many institutions.
market we have ever traded. We will come back to this point in a moment, but first let’s look at the competition we Forex traders face and briefly discuss how we cope with it while trading.
The following is our a s ses s me n t of the c omp et i t i o n we face when we trade Forex:
First there are a very large number of i n d i v i d u a l s –some trade sizab le ac c ou n t s, but for the most part, the largest number of these traders work with an account of modest size. We also suspect most of these individuals are
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