How To Make Probability Work For You in Trading

[moonchild]

As we all know Forex trading is a game of probability and whenever we place a trade we are putting probability to work and a single outcome means little to nothing in the grand scheme of things because it's the cumulative results that matters in the long run, to make probability work for you you have to build a system.

A system that has been back tested for at least 10 years with a forty to sixty percent win rate and you are good to go.

By using this strategy you know that in the long run you will be successful, might be within ten or hundred trades but probability is in your favor, this will help eradicate attachment in individual trades.

 

[FinTrader]

Probability will work for you in trading only when trading is systematic and according to the rules of your proven trading strategy. To do this, this strategy must give the majority of the correct signals for trades, and if you have the restraint and discipline to follow all its rules, then trading in general will be profitable.

 

[Leah Kelvin]

Crucial to making good decisions as well as strategies in trade is the ability to understand probability. For probability to work for you, it is necessary that you employ a dependable trading system that is founded on statistical analysis and has crystal-clear entry and exit rules. By analyzing historical information one can recognize patterns and tendencies which will in turn make more profitable trades possible. Successful traders are able to effectively manage their trading risk by applying risk management techniques such as stop loss orders. Unlike Fundamental analysis which takes into account market moving events, technical indicators like moving averages, oscillators can identify entry and exist points. There is also need for backtesting and validating of strategies hence increasing the odds of success in trading.