A forex trading strategy is any technical or fundamental set of tools used together that are designed to approach the markets and its’ aim is consistent positive returns.
There are millions of strategies out there just like traders, the difference is there are only a few strategies that bank consistently, just like there are only a handful of traders who produce consistent results trading the forex market. In this regard literally anyone can put together a strategy and their strategy is nothing more than their own interpretation of the market using predefined technical or fundamental basics. Since the price movements in the markets are based on perception and interpretation of where price should move, it is safe to say that market movements are based on the each and every market participants perception and personality making it one of the biggest psychological hubs in the planet.
Every market is made up of people and when they trade they find themselves in this group of mass psychology. Now that we know the markets are a group of mass psychology is safe to say that every Forex Trading Strategies since its’ implemented by traders will always be based on the individual perception of each and every trader. This sheds a new light on the understanding of what a strategy is and is helping beginners as well as advanced traders realize that there is no holy grail which bank millions overnight and is promoting self responsibility which is one of the most essential ingredients on being consistent. What do I mean by this ? It simply means that a strategy plainly applied will not give consistent results without the mindset and the right approach by the one who is applying the strategy. The sooner traders realize this the sooner they will be on their path to consistency. What can one do to be consistent?
Learning the basics of fundamentals and technicals and revise a strategy for themselves, backtest, put serious hours into chart time, go through historical price action. The main issue with this approach is that it literally takes years, years that produce little to no results not to mention the fact that it is hard for the trader itself to have confidence that what they came up with will be consistent month on month year on year which will give room for second guessing, switching between entry and exit methods as well as trade management methods which disrupts the strategy and will be in a drawdown. Now the solution is to get a professional trading education and strategy which eliminates the ‘not having confidence’ factor because professional trading strategies and educations have proven positive results giving the trader confidence in the strategy and the only thing which remains is for the trader to work on themselves by applying the strategy correctly and eliminating errors while holding themselves accountable for mistakes and developing their own trading style based on the strategy, this route guarantees success and consistency.
If you give the average man a strategy that will surely make him a millionaire in 10 years, he will most likely modify that strategy in an attempt to realize those results in just one year, in doing so will create a routine where he will not become a millionaire in neither one or ten years, for the same greedy psychology factor will cause him to change the initial strategy will strike again and again when his new systems are not producing massive results in the short term. Master your Mind. Master The Market.