How many forex trading strategies do you think you need to have in order to be successful in forex? 2, 3 or as many as possible, I think some of you are already having that in your mind. But the answer is 1.
With the internet today, you can get any information you need with a click of a button which is something great. However it also created another problem for traders which are known as “Information Overload”. With the availability of information everywhere on the web, you will get to learn numerous strategies but never ever stick to one until it works.
When I first started trading a few years back, I often hop from one strategy to another thinking that the new one must be better than what I am using now. Without sticking to one strategy, you will not be able to test it long enough on demo account to see if it works for you or not.
Worse still, I often give up on a strategy once it produces a losing trade as I thought that (at that time) a good trading strategy is one that produces 100% winning probability. (Something that doesn’t exist)
So what makes a good trading strategy?
To me, a good trading strategy is one that can produce a decent winning percentage of about 60 to 70% and most importantly, it must be able to generate high risk reward ratio which is the key to the success of all professional traders.
In fact, the above strategy is what you actually need to be able to trade forex for a living. Once you have a reliable strategy, you should stick to it and use it to make money for you. The problem with most new traders is they often give up this reliable strategy once it produces a losing trade and starts to find another one hoping that it can give them 100% winning.
So my advice to those of you who are still hopping around looking for the best strategy to trade with. Stay focused and hang on to one strategy that you think suits you best and then practice it on a demo account until it works before you try it on live account.