What Do You Need for Successful Trading?

There are buyers (bulls) and sellers (bears) in any market and their goal is to make profit. It is obvious. The difference between them is in a direction of trading. Buyers are interested in upward and sellers in downward movements. If buyers are stronger than sellers, the price moves upward. If sellers are stronger than buyers, the price moves downward. It is simple.

So, for you as a trader, if you want to make money in the financial market, it is very important to join the right side in the right moment. If buyers are strong, you have to buy and join the bullish team. If sellers push the price downward, you should open short trades. Of course, different types of trading may require some different tactics, but the main idea is the same, you have to be on the right side!

And here we face with a question? How to pick the right side? What do we need to use in order to understand that buyers are stronger than sellers right now? Which tools may tell us that the market is going to move upward but not downward and vice verse?

For this, we have to understand what is going on in the market and plan possible trades considering the most important information which any market can give us in any period of time.

If you think that for profitable trading you just need trading signals, when to open a position and when to close it, you are wrong! The exact entry and exit points, as well as direction for trading, they have to be the result of pre-trading activity such as research and planning.

So, what do you need to know about the market BEFORE!!! opening a trade?

You must know:
1. Market conditions! It is the basis! Without understanding the market conditions it makes no sense even to dream about profitable trading. You have to understand the market conditions in order to pick the right strategy which matches them. If you trade using trend following strategies in the range market conditions, you will fail. The same goes for range trading approach in the trend market. You have to understand the market conditions AND the sentiment. Which you can see right now just in order to follow it as well. Market conditions tell you in which direction to trade and which trading strategy to use! It is very important.
2. Valuable areas, and here we talk about support and resistance levels, Moving Averages, trend and counter trend lines. The thing is, the most important actions in the market are around such levels. Buyers build long positions around support levels. Sellers go short from resistance. There is action around the valuable ares and we have to use this action for our trading. If we open long trades at support following reversal setups, it means we join buyers and we may expect an upward moment if they are strong enough. We plan short trades at resistance expecting that sellers will be able to reverse and push the price downward. The same principles can be applied with trend and counter trend line.
Trading at valuable levels and lines we can get good entry points and place stop orders not far from them. If so, we may expect trades with good risk-reward ratio and it means a lot for the proper risk and money management. So, valuable areas give us a lot.
3. As soon as we got understanding about the market conditions, valuable areas, we can plan our trades considering all this information and combine them with exact trading setups and patterns we use in our trading. The price action around valuable areas and the exact market conditions will be able to show us in which direction it makes sense to trade, which trading strategies to use for buying or shorting and where to place exit orders such as stop and take-profit. And here you can use absolutely different trading styles and strategies, time frames which will give you different options how to get benefits from the market movements.

So, the main idea of this post is the following:
For successful trading you must know in which direction to trade and where to open and close your positions. For this, you must understand what is going on in the market, what are the market conditions, where are valuable areas, and which trades you can get depending on the exact price action and trading signals.

That’s why I offered you a new format where I share with you Market Conditions based on the daily tf, Valuable Areas and offer possible Trade Opportunities.

I hope this post give you better understanding what should you do in order to become a successful trader.

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