Life (and the Forex Market) works the same way a firearm works. Here's an example.
You own a gun and want to go targeting practice, so you go to a gun range. At the gun range, you load your magazine with 5 bullets, put the magazine into the gun, aim and fire.
When you fire your gun, the gun has to eject the shell casing to reload another bullet into the chamber so you can fire your next bullet. This example applies to most stuff in life.
You get up in the morning, do your daily stuff, but at night you have to eject the shell casing (go to sleep) to let new energy fill the chamber so in the morning you'll have the energy to do your daily stuff again.
You go to the bathroom to eject the shell casing so you can eat again (fire the gun again).
You pay the taxi driver (eject the shell casing) to make the taxi driver able to take you someplace else again.
The list goes on and on, but how does this ejecting the shell casing connect to trading? Easy. The market can only go up so much before it has to reload another bullet. To reload another bullet, the gun has to eject the previous bullets shell casing, and when that happens in the market, the price falls a bit before the next bullet makes the market go bursting up.
After all 5 bullets are fired, the gun can't fire no more. In trading, the market can't go up no more, so it reverses direction. Once we change the magazine, the market starts going up again.
We can never figure out how many bullets are in the magazine of the market and when they run out because we didn't load the bullets in, the market makers did, but we can figure out when the bullet is fired (the market bursts up), and when the market ejects the shell casing (the market falls a bit). When the market falls a bit, we know that its ejecting the casing and the next bullet is about to be fired. When we think the shell casing is successfully ejected, we order a buy position so we catch the next bullet ride up.
Play around with the indicators in your trading platform and try to make a strategy that will tell you when the bullet casing is successfully ejected.
Here's an image example. It may look complicating, but you'll figure it out.
You own a gun and want to go targeting practice, so you go to a gun range. At the gun range, you load your magazine with 5 bullets, put the magazine into the gun, aim and fire.
When you fire your gun, the gun has to eject the shell casing to reload another bullet into the chamber so you can fire your next bullet. This example applies to most stuff in life.
You get up in the morning, do your daily stuff, but at night you have to eject the shell casing (go to sleep) to let new energy fill the chamber so in the morning you'll have the energy to do your daily stuff again.
You go to the bathroom to eject the shell casing so you can eat again (fire the gun again).
You pay the taxi driver (eject the shell casing) to make the taxi driver able to take you someplace else again.
The list goes on and on, but how does this ejecting the shell casing connect to trading? Easy. The market can only go up so much before it has to reload another bullet. To reload another bullet, the gun has to eject the previous bullets shell casing, and when that happens in the market, the price falls a bit before the next bullet makes the market go bursting up.
After all 5 bullets are fired, the gun can't fire no more. In trading, the market can't go up no more, so it reverses direction. Once we change the magazine, the market starts going up again.
We can never figure out how many bullets are in the magazine of the market and when they run out because we didn't load the bullets in, the market makers did, but we can figure out when the bullet is fired (the market bursts up), and when the market ejects the shell casing (the market falls a bit). When the market falls a bit, we know that its ejecting the casing and the next bullet is about to be fired. When we think the shell casing is successfully ejected, we order a buy position so we catch the next bullet ride up.
Play around with the indicators in your trading platform and try to make a strategy that will tell you when the bullet casing is successfully ejected.
Here's an image example. It may look complicating, but you'll figure it out.