Anyone successful in the forex market will hands down agree there is no greater career one could have. The ability to work your own schedule, the freedom, and income potential is hard to match with any other career. Having said that, what does it take to become successful in the forex market? Plain and simple we need the proper forex education to achieve success. How does one go about doing so?
To put it simply if the forex trading strategy that is being used is one used by the masses, then how can one expect different results than the masses? Before we begin I would like to give a preface to the forex bank trading strategy. First, it is common knowledge that the banks drive the forex market. It is not a hidden fact that they drive the most amount of volume on a daily basis and as a result they drive short term moves. This is the very foundation of the bank day trading strategy we employ.
If we can decipher when they are entering, and what position they are taking then we do not need any further information to make a profitable forex trading decision. We must remember that this is the banks market, and not ours! Retail traders are simply figurative flies on the wall. Keeping that in mind, why then do most retail forex traders out there attempt to invent or learn forex trading strategies that have been created to try and fit a market we do not control?
This is their business, and they have a business model aka forex trading strategy that we must learn to follow to achieve consistent results! Every day the banks repeat the same 3 step process.
As we just mentioned the banks use a 3 step process day after day to profit from the forex market. We can think of this process as their forex trading strategy. It has rules that they follow, it is repeatable, and it consistently results in profit. In any market there must be a counter party to every transaction.
If you are looking to buy the market someone must be willing to sell to you, and conversely if you are looking to sell the market then someone needs to be willing to buy it from you. This is the basis for how the market at its foundation works and therefore this is how we track how the banks trade.
As discussed above there is a counter party to every transaction in any market including the forex market. Therefore when a bank or group of banks desires to enter the forex market they must do so by accumulating a position over time. Unlike you and I, because of the sheer volume banks push they must enter positions during times most people would term as consolidation or range bound markets.
These periods of consolidation are what we call accumulation as they are areas where smart money banks, hedge funds, ect enters or accumulates their desired position over the course of time. By doing this through tight range bound periods banks are able to not only keep what they are accumulating secret to the rest of the market, but they are also able to get a much better overall entry price.
This is the foundation to any trade made by the banks. Money is made by accumulating a long position they will later sell off at a higher price, or accumulating a short position they will later cover at a lower price. This is one of the most essential keys to trading forex successfully, and yet it is always over looked or worse yet called consolidation which is viewed as useless times in the market that mean nothing. Our single goal should be to track when the banks are entering the market and what position they are entering and thus these areas of accumulation are critical to our trading decisions.
As discussed above banks are the ones moving this market, and therefore if you can identify the position they are accumulating you can identify which direction the market will move next with a high degree of accuracy. What then comes after this period of accumulation?
Many retail forex traders feel as if the market is just waiting for them to enter before it instantly turns the opposite direction. This is a critical idea that all must understand and come to accept.
We all know the failure rate among traders, but what does this information tell us? Remember above when we discussed that there must be a counter party to every trade?
This is a well-known fact and it is indisputable. Because the mega banks position is so large they must essentially create their own market. This is where the retail forex trader comes in. Forex traders are predictable. As a general rule of thumb all traders go through the same education, use the same trading strategies, and use the same software and indicators.
While each strategy has its own small differences, the majority generate the same losing results and this is undeniable. Therefore while the strategies differ, the outcome and thus trades tend to be in large part the same which explains why the outcome of retail traders tends to be the same. Because of this the banks are well aware of how to get retail traders to enter the market. At this same point they would begin to sell into all that buying pressure, and then the market instantly turns to the downside.
This is the central reason many retail forex traders consistently enter the market at exactly the wrong time. The unfortunate part about this is the fact that this information is actually the most powerful thing the banks give us, but only if we open our eyes to it.
The manipulation of price tells us what position they have been accumulating and thus tells us the direction they intend to drive the price. I urge you to look back at all large market moves. After they have accumulated a position through the standard tight ranging market, banks will often create a false push that we just discussed which is manipulation. This false push is an extension of the accumulation period as it allows them to finish entering the rest of the position they had been accumulating.
This as we just discussed is the reason so many forex traders enter the market at exactly the wrong time. If however we know the tricks they use we can avoid being a pawn of the banks manipulation, and instead profit from it as they do! If we have correctly identified which direction they have manipulated the market we can then understand which direction they intend to push the price.
This is called the distribution phase of the market, and is seen visually as a market trend. Again this market trend comes only after the banks have finished accumulating their position through tight range bound price action as well as manipulation. Hands down this is the easiest area for us to profit from but only if we can properly identify the first 2 steps in the process. Through this article I have marked out this 3 step process on a series of charts.
New concepts can be hard to understand with only words and therefore I believe the charts should serve you well in the learning process. As you examine these charts you should be identifying the 3 stages of the bank day trading strategy. Bottom line is this forex trading strategy is no doubt very different than what you have heard before. Realizing the chart is a false manipulation of prices and learning to read the intention behind the moves will take practice.
Anything in life that is new takes time to learn and this will be no exception. However, the potential reward of being a profitable forex trader is massive and in our opinion unmatched! Having the freedom to do as you like, and the money to support that freedom is something forex trading offers to all of us, but only if we are willing to work for it. Everyone reading this knows most traders fail.
Everyone reading this knows the general ways most trade. Therefore if you are using a forex trading strategy used by the masses I strongly urge you to give some serious thought as to why you feel the outcome will be different for you?
Therefore I again urge you to take in this free information, give it some thought, and apply it in your trading! I say this not to offend anyone but rather in a sincere effort to get everyone reading this thinking about the facts. Either way I sincerely wish you all the best and I truly hope I can serve you in your progression as a forex trader. That is the most inteligent aproch to FX market — To learn the rules of the game , you have to climb on the tower platform and not through keyhole into door.
As I always say, trading is not rocket science. All sure wins are obvious patterns on the chart. There is a ranging period travelling in a well-defined channel, a retracement to an indicator your broken line looks like the 21 SMA to me and a sudden push forward as it breaks through a pivot line.
You know it goes a long way when the resistance is broken. You can do this when you position yourself well. Glad to hear you do well with this. The key is understand what is being accumulated…and thus which direction you should be looking for the manipulation. I know this is kind of off topic but I was wondering which blog platform are you using for this site? I would be great if you could point me in the direction of a good platform. I sent you an email on how to improve your security with wordpress.
Our site is a WP platform and since we have improved our security we haven had much problems with hackers. This makes a lot of sense. You may have mentioned it somewhere, but what time frames were being used for the charts provided?
Are there specific ones that the phases should be looked for using? We use the 15 minute time frame for entries but also look at the hourly charts to build a bias for the day. If its clear we look mainly for signs in that direction otherwise we look for the clear manipulation at the high probability levels we als get from the hourly charts.
There is also the EMA showing us where the H1 ema is on the 15 minute chart. Just watching the course would do you no good. This is why traders fail. Its like learning to fly an airplane by reading a course or learning to do brain surgery by reading a course and watching some videos.
When I learned to fly an airplane I had an instructor that spent the first 20 hours of flight time with me before I was able to solo. This is the same in forex. The course is important just as it is in learning to fly, but the most important part was having the instructor sitting in the right seat actually SHOWING me how to do everything. The amount of trades we have each week varies.
If you go look under the Recent Trades tab on the site you will find the last 6 months of trading results. Each post has a video for every month.More...