I took the time this afternoon to watch a video on YouTube by Akil Stokes. In that video he spoke about forex traders that are trading without a plan. He likened it to someone trying to drive somewhere that they had never been before without the help of a GPS. If you plan to arrive at your destination and reach your goals and you have no way of knowing how to get there… you will very likely get lost along the way.
Likewise, if you are attempting to reach your goals in trading and you have no plan with specific rules that take into consideration the different obstacles that you are liable to encounter along the way… a so called “if/then” set of rules… it is very likely that you will lose your account. Congratulations you are on the road to becoming another participant of the 90+ percent that get detoured and fail at Forex trading.
I was thinking how times have changed… If you had given that same talk a couple of decades ago people would have been wondering what you were talking about. They would be saying,”What is a ‘GPS’ “? I guess you could say that a GPS is not really a “Guaranteed” Profitable Strategy… because there are no guarantees in forex.. but more like a “Generally” Profitable Strategy. Of course in order to establish it’s trustworthiness, it would mean that you have spent time pouring over charts and history back testing your strategy to see if over time… it produces a profit.
Before there was such a thing as a ‘GPS’ you had to do it the old-fashioned way. In order to navigate and arrive at a destination where you had never been before, you really need four things.
- YOUR DESTINATION
- YOUR LOCATION.
- A MAP.
- A COMPASS.
When you think about it, these are the four things you see when you look at your map on your phone or gps. Having just one of these things is worthless. If you are lost in the woods and find a map, it does you no good if you don’t know where you are on the map or even if it’s a map of where you are.