Should we open trades on certainty or on probability? - Page 20
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Thread: Should we open trades on certainty or on probability?

  1. #1
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    Should we open trades on certainty or on probability?

    Trading with certainty : Well the obvious and clear answer for the above question might be a trader should always open trades on certainty. But the problem is that way a trader cannot open a single trade because certainty never exists in our trading. So trading with certainty can only be a fantasy that can be imagined and the only option left to the trader is to trade on probability.

    Trading with probability Every trade can give us profits or losses. There are many factors responsible for the trade to either end up in a profit or end up with a loss. Even after we trade after making proper analysis or after waiting patiently for a good signal given by our indicator or combination of indicators we cannot relax by thinking that now my trade is bound to give me profits. That 100% certainty cannot happen.

    Need of analysis : So now we find that both trades done with analysis and trades done without analysis can give us loss. So now a person may think what is the use of doing analysis if anyway he can end up making a loss? Here is what the role of probability comes


    Probability
    Our trading is always based on probability and never on certainty. If a trader can judge the market movement well and can make good analysis then his trades will have a higher probability of giving profits and lower probability of giving losses. These probability can effect our trading results drastically. A trader whose trades have higher probability of profits will have more profitable trades in his portfolio and more profitable trades simply means more money in his bank. If he could implement a good working risk management system that will boost his overall trading performance positively.

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  2. #191
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    Open trades in accordance to the strategy you have made use of, that is what I know about the market, which means that after learning a trader should be able to know if to buy or when not to sell, it is a learning process that will yield to us good profitable trades. That is why we have to always follow the demo trading account, it takes consistent learning to know if we are to take a trade after analysis, because when new, we take trades mostly with emotions.

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  3. #192
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    The point I want to make is that before we should open any trade in the marker we have to make sure we have all the things been done, like making the suitable analysis, following proper money and risk management, most importantly we don't need to trade without taking good calculation of the movement of the market.

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  4. #193
    Trader lawners1791's Avatar
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    as managing use of customs with technical evaluation with the moderation of chart movesment of the market price drawing, trader to collects of different unit of examination as might to defines of selection with the returns to helps with the decision on disposing the worse of risks and prepare to enter trade with the precise of option to put with the request of execution.

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  5. #194
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    well i think one can never be certain in forex business we need to understand we can never tell the market what to do and regardless of the level of understanding we might be having as a trader to trade forex we can never control the market and no trading strategy is certain all the time so we need be prepared to loss some position when trading.

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  6. #195
    Trader nadezhda84's Avatar
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    Forex charts are a result of a stochastic process. Strictly speaking, any trading is on probability. You can estimate probability using your indicators and enter only the best and the most probably, the most profitable trades. Then you have to wait. Because any trade started from a good point will be profitable, just time is to waited.

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  7. #196
    Trader xauyuro's Avatar
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    Quote Originally Posted by shivanandfx View Post
    Trading with certainty : Well the obvious and clear answer for the above question might be a trader should always open trades on certainty. But the problem is that way a trader cannot open a single trade because certainty never exists in our trading. So trading with certainty can only be a fantasy that can be imagined and the only option left to the trader is to trade on probability.

    Trading with probability Every trade can give us profits or losses. There are many factors responsible for the trade to either end up in a profit or end up with a loss. Even after we trade after making proper analysis or after waiting patiently for a good signal given by our indicator or combination of indicators we cannot relax by thinking that now my trade is bound to give me profits. That 100% certainty cannot happen.

    Need of analysis : So now we find that both trades done with analysis and trades done without analysis can give us loss. So now a person may think what is the use of doing analysis if anyway he can end up making a loss? Here is what the role of probability comes


    Probability
    Our trading is always based on probability and never on certainty. If a trader can judge the market movement well and can make good analysis then his trades will have a higher probability of giving profits and lower probability of giving losses. These probability can effect our trading results drastically. A trader whose trades have higher probability of profits will have more profitable trades in his portfolio and more profitable trades simply means more money in his bank. If he could implement a good working risk management system that will boost his overall trading performance positively.
    I think open trades based on this probability are the same as suicide. such as doing open trades based on speculation, rather than on existing data. Of course this is not a healthy way because it only relies on the possibility and not the actual facts.
    it's like we buy eggs, but we don't know whether these eggs are rotten or not. even though the eggs that are rotten or not suitable for consumption can be seen from the shape of the shell, the volume of the contents of the egg and the smell

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