Forex Factory: Ready to Work on the Assembly Line?

Like forex robot trading, remove all emotions and approach forex with an almost-automated currency trading psychology, for best results.

The term forex factory is actually looked up in internet search engines quite often. Why? Besides there being quite a few really good sites with this exact name, the process of trading forex is actually quite a bit like an assembly line.

I’ll explain how:The forex market, while being quite volatile in terms of price fluctuations, actually is quite a predictable environment. You know that in most cases, the currency will move each hour. It will either go up or down or, less frequently, stay at the same point. At the end of each hour (or 30 minutes, or 15 minutes, or whatever time increment you have your chart set at) a “candle” will form at the end of that hour, which documents how far the market moved in that time period, and whether that movement was upwards or downwards.

Then, these candles form candlestick patterns with other candles that tell you when to enter or exit the market. Over and over, these candles form. Forming enter and exit signals. Taken a step further, a trader can then examine past market movements and candlestick signals to determine where the market will travel to in the future. Although subject to the typical warnings inherent to all types of trading, it is this technical analysis which has stood the test of time as being predictably accurate. This predictability reminds me of a factory.

The need to remove emotions from a trade is another way that trading forex is like a factory process. This is why forex robot programs, designed to identify trading opportunities and get you into and out of trades, are so popular. However, the success of these trading robots is mixed. Sometimes I personally just get a warning feeling to stay out of a trade, and my feeling is never wrong. Robots don’t have feelings (yet…) The best way is to perform trades yourself, in an unemotional, well-thought-out way, with your entry and exit strategies planned. This ensures a smooth profit assembly line :)

Another way that trading can be likened to a forex factory, is that trading can be dang hard work! No matter how long you’ve been trading or how much money you make from it, there will be days that you sit at your computer for hours on end, willing a trading opportunity to reveal itself. It can become very mentally taxing! I recommend spending no more than a few hours a day actively looking for trades. Otherwise, you’ll drive yourself mad.

It’s important to remember this though: although forex trading might be predictable, it’s also very volatile and one small error can lead to a catastrophe! Small mistakes like entering a trade on a wrong currency pair, setting the wrong amount for your stop-loss and limit orders, or forgetting to trade with a stop altogether are common, and preventable mistakes.Trading is a lot like a forex factory – above all it’s important to have a process and stick to that process, no matter what.

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