Rank: Member Joined: 9/11/2015 Posts: 242 Location: Thika
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TNT wrote:Jon Jones wrote:The reality of forex trading is that it is a voodoo science. These are my reasons:
- Unlike commodities and indices, forex is susceptible to unknown or unpredictable market moving news. If you are trading the cable, and the bank of England tampers with interest rates in any way, your technical research is invalidated instantly. So, I believe currencies are not technically compliant like indices and commodities where the mass market is involved and basic laws of demand and supply work. The charts can be quite erratic. You are welcome to check on tradingview the price behavior of oil (WTI - West Texas Intermediate) or even Gold (XAU) and compare their price behavior against the cable (GBPUSD). You will see that commodities, precious metals etc are more technically compliant because they rely heavily on basic demand and supply.
- It is nearly impossible to conduct comprehensive fundamental analysis in forex to back up your technical analysis.
- The moves are extremely small for the few liquid markets such as the cable. This forces traders to use massive leverage to amplify moves, sometimes even 200:1. The broker pockets large fees and the trader weathers himself down over time. Even when you are right directionwise, the funding and fees will eat massively into your profit if the trade takes long to reach your target. Leverage = High Fees = Broken Dreams.
They say 90% of forex traders lose money. I would say 0ver 97% lose money in the long run. They lose money to the few 3% and the brokers who keep pocketing large fees from highly leveraged traders, and liquidated positions on isolated margin. In other words, most forex traders are living in a fool's paradise.
The real forex traders own forex bureaus, don't use leverage and have good spreads sometimes over 5% selling to the ordinary man in the street. Banks and bureaus operate profitably but traders on exchanges using crazy leverage don't profit in the long run because the odds are stacked massively against them when fees, leverage and holding costs of open positions are factored. Change my mind. Given opinions are like ass-holes, no one should waste their time trying to change your mind. You have a right to your ass-hole. Judging by your uncooth response, I can safely predict that you do not earn your living from forex trading. You either do it as a passtime to make a quantum leap to multimillionairedom in a few months (without realizing that you are on a fool's errand), or you are a marketeer of trading techniques and not a real trader. Either way, I am vindicated. Since men have learned to shoot without missing, I have learned to fly without perching
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