The Game of FOREX Trading

Speculating on the price of one currency in relation to another (also called trading the Forex Trading spot market) is like betting on a game; in the Forex market, the game is between the bulls, who want to pull prices up, and the bears, who want to pull prices down. The most successful trader in forex trading will not put himself in the middle of that game just as you or I would not go onto the field in the middle of a professional football game (unless, of course, you happen to be a professional football player). Instead, the successful trader will stand above the game for the best view and the best chance to bet on the team with the winning play. With over one and a half trillion dollars traded each day in the Forex market, it is highly unlikely that any individual trader like you or I would be able to influence the outcome of the game between the bulls and the bears - so we do not try; instead, we try to take our best, informed, educated guess at who will win a given play, and we bet on it - we speculate.The fact that we are not actually able to influence the outcome of the Forex trading game, that we are simply speculating - betting - on it, is very important to remember, because it means that what matters to us is not so much who has a better quarterback, or whose coach makes better plays. Instead, what matters is what other people think.Which team are other traders going to bet on? The bulls may be superior in a certain play but if everyone bets that the bears will win, then . .. the bears win.So trading the Forex is not nearly as much about picking the strongest currency, identifying which country's particular economic, social, and political situations make its currency the best buy that day. Trading the Forex market is about foreseeing which currency the crowd will pick, picking it before they do, and being right.