How to Beat the Odds Forex Scalping Triad Trading Formula

get.mytriadtradingformula.com A look at how to beat the odds when scalping in the forex market from Jason Fielder of Triad Formula. http

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Forex Trading by Stacking the Odds in Your Favour

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Often forex trading is compared to gambling. Some who follow the random market theory support this view. However some technical analysis experts would argue that technical analysis Forex techniques stack the odds in the favour of the trader. Sound money management and risk management are another ways of stacking the odds in the favour of the trader

How much do the odds have to be in the favour of the trader for them to make money? Often a trading success rate of 70% to 80% is assumed as the requirement to make money. At 70% your gains would be $700 (assuming gains and losses of $100 per transactions) and losses would be $300 resulting in an overall gain of $400. Let’s take a closer look at this assumption.

In Currency trading, when the price reaches strong resistance or support, the question is: will the price bounce back or violate the barrier? Good channel traders and support and resistance traders will tell you that in general there is a 70% chance of a bounce and only a 30% chance of a breakout. These are important statistics.

The other statistic is that when there is a false breakout (60% of the time) it will only go say 25 pips past the barrier and then be forced back. Knowing this statistic is another big advantage for traders. Most indicators or trading methods have these kinds of statistics.

The risk management technique that experienced traders use is the risk compared to reward ratio. Many will only enter trades that allow them to gain 200% of what they risk (their stop loss). This is a particularly powerful way of trading as they make $200 on successful deals and only lose $100 on positive deals. This means that if they had a 50% success transaction success rate, on 10 transactions, they would earn $ 1000 on successful transactions and only loose $500 on unsuccessful ones. A profit of $500 with only a 50% success rate. Much better than the $400 gain calculate above.

Just like card counters who make money from BlackJack you need to develop the skill of stacking the odds in your favour when Forex trading. This means knowing technical analysis very well and knowing the characteristics of the forex market very well.

Clever money management is also used by BlackJack card counters. When the packs are rich of high value cards they would progressively increase the value of their bets. They would bet very low or not participate when the odds are not favourable. This is one of the most neglected aspects of Forex trading and as a Forex trader you need to develop this skill.

Remember the trader above who achieved a 50% success rate and made money because a 200 to 100 return on risk ratio was used. Now imagine that only 1 lot was used for higher risk trades and 2 lots were used higher probability trades. The gains will now be $2 000 ($200 x 5 x 2) and the losses $ 500 ($100 x 5 x 1). A $ 2000 gain compared to $ 500 loss. Now we talking. We are only using a 50% success rate. This $1500 profit at 50% accuracy compares well with the $400 profit at 70% accuracy.

The above is only an introduction of how some successful traders do not let losses worry them as they have the odds stacked in their favour. Many trading firms (including ours) take their traders through a course of Casino game gambling odds to show them how easy it is to make money on the forex when you stack the odds in your favour.

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FX Forex Trading – is it Possible to Beat the Odds?

If you are interested in FX forex trading, then you might have already asked yourself if it would be possible to beat the odds at all times so you can always come out unscathed and richer. Sadly, the answer to this is no. The forex trade, as with other trading markets, is still full of risks. No one can actually be a hundred percent sure when it comes to getting more money than losing. But the reason why more people are still entering this kind of trade is the simple fact that you can increase your chances of making money even with the present risks. And, if the situation is good, trading foreign currencies is a fun way to earn big money.

FX forex trading is not without risks. Whether you are a new trader or a seasoned one, you always put your self and your investment at risk. But all these risks create the thrill and excitement that we are all so much after. And while the risks exist, there are ways by which we can increase the chances of earning.

One way to increase our chances of earning good money out of FX forex trading is by having the right tools and the right resources. When it comes to online FX trading, you need to have a reliable trading platform that you feel comfortable with. The only way to know which platform is for you is to try out some and choose which one works for you. Another factor that can lessen the risk of losses is by getting sufficient trade training. You can choose to take course and also do your own study and practice. You will never run short of resources as there are many available both online and offline. Using all these, you cannot beat all the odds but you surely can take your chances armed with the right weapons.

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