Direct from the desk of Dane Williams.
I firmly believe that for newcomers to the forex market, mechanical trading strategies offer a solid foundation for you to build the skills required to become consistently profitable.
It’s for this reason that I continue to encourage those of you who are either trying to get into trading, or struggling to find your feet, to try my entirely mechanical Master Candle trading strategy.
You see, to make it as a trader, precision and strategy are your keys to the castle.
Therefore, choosing the right trading strategy and approach to how you go about executing your plan, will make all the difference in the world.
While both mechanical and discretionary strategies have their merits, I need to stress that mechanical strategies truly shine as the premier starting point for beginners.
Here's why.
Mechanical trading strategies provide a structured and rule-based framework that leaves little room for emotional decision-making.
Emotions, as I’m sure you’ve figured out by now if you’ve traded for even a week, can be your worst enemy.
Whether positive or negative, they almost always lead to impulsive decisions that result in substantial losses.
By taking a mechanical approach, your emotions are completely removed from the equation.
Allowing you to stay on course with your trading strategy and only have to make consistent, binary choices.
Let’s go back to my entirely mechanical Master Candle Trading Strategy.
If you still don’t know what a Master Candle really is then go back and read that post.
But basically like all mechanical strategies, Master Candles are designed to radically simplify your trading process.
Making it not only accessible, but also profitable right off the bat, even for those who are new to trading forex.
My strategy revolves around the concept of identifying a Master Candle, a type of inside bar candlestick pattern that acts as a reliable indicator of potential future price movements.
By adhering to a set of predefined rules when recognising this pattern, traders can enter and exit positions in the strategy’s recommended direction, with confidence.
Mechanical trading strategies eliminate the guesswork and subjectivity often associated with discretionary trading.
Instead, they offer a clear and structured path to follow.
One that is ideal for those of you who are just embarking on your forex trading journey.
Furthermore, mechanical trading strategies are easily testable and can be backtested with historical data.
This means you can evaluate their performance and refine them over time, ensuring that you are continually improving your trading tactics.
It's a process that allows for steady growth and learning, skills that are obviously vital for beginners.
In contrast, discretionary trading relies heavily on the trader's experience and intuition.
While experienced traders might excel in this realm, it can be overwhelming and risky for those who are new to the forex trading discipline.
The ability to make split-second decisions based on what your gut feeling is saying about price action around support and resistance zones, comes with time and practice.
But until then, it's often wiser to rely on mechanical strategies that provide you the safety net of predefined rules.
So there you have it.
For relatively inexperienced forex traders, mechanical trading strategies like my Master Candle strategy, offer a structured and logical approach that minimises emotional decision-making.
They provide an excellent foundation upon which you can build your skills and understanding of the forex market overall.
While discretionary trading certainly has its place for those more experienced, starting with a mechanical strategy can pave the way for a successful trading career.
There’s no point blowing up your account before you even fully understand what’s going on in the markets (and between your ears)!
Best of probabilities to you.