• Skip to primary navigation
  • Skip to main content
  • Skip to footer

ForexSchoolOnline.com

Learn to Trade Forex Online

  • Compare Brokers
    • Broker Type
      • Paypal Brokers
      • Swap-Free Brokers
      • Low Spread Brokers
      • ECN / STP Brokers
      • Market Maker Brokers
      • Non Dealing Desk Brokers
      • Low Minimum Deposit Brokers
    • Country
      • Brokers for Australia
      • Brokers for South Africa
      • Brokers for the UK
      • Brokers for the US
      • Brokers for Nigeria
    • Regulation
      • FCA Regulated Brokers
      • ASIC Regulated Brokers
      • FSCA Regulated Brokers
      • CFTC Regulated Brokers
    • Platform
      • MT4 Brokers
      • MT5 Forex Brokers
    • Strategies
      • Hedging Forex Brokers
      • Scalping Forex Brokers
      • Carry Trade Forex Brokers
      • Brokers for Indicators and EA’s
  • Start Here
    • Start Trading Guide
    • Beginner Trading Lessons
  • Free Forex Course
    • Public Login
    • Register
    • Password recovery
  • Lessons
    • Strategies
    • Videos
    • MT4 Guides
    • Money Management
  • Trade Setups
  • Tools
    • Correct Free Demo Charts
    • Forex Journal Download
    • Position Size Calculator
    • FULL List of Tools
    • Forex Demo Accounts
  • Price Action Guide
  • Free Course

Profitable Trading Edge: How to Transform Your Trading

Johnathon Fox
06/22/2013 | UPDATED ON: 04/27/2019

Profitable Trading Edge: How to Transform Your Trading

This article is going to change the way you think about your trading and also the way you approach your trades.

One of the biggest reasons losing traders are losing is because they do not understand some of the key principles of the market and also because they do not approach the market with the correct mindset.

No matter how great a trading system a trader may have, they will still lose if they are approaching and thinking about the market from the wrong mindset. Until the trader changes this and learns to think about the market from the right way they will continue to lose.

In this article, I address these key issues so traders reading this article can transform their trading by realigning their mindset.

The reason that so many traders will continue to fail is that not only do they have the wrong mindset, but they are tricked into the never ending trap of thinking that it is their “system” that is failing them.

This pattern starts with a losing trade or losing trades. The trader will then throw the method or system away and go on a hunt for a new system. When that system fails the same pattern will continue, with that system thrown out and the hunt for a new system beginning. You can see this pattern happening in all the large

Forex forums throughout the world. Go to any large Forex forum and look at where the vast majority of the traders are lurking. 80-90% of traders are in the “method and systems” area trying to find that next wiz bang system!

The trap is that with the mindset that the losing trader has, it does not matter what system they pick up, they are going to go on continuing losing. This means that until they fix the thing that is holding them back, their search for the “Holy Grail” system is going to go on in vain forever or until they give up or blow their trading account and both often happens. It does not have to be that way and in fact it should not be that way.

 

What Exactly is a Profitable Edge?

We speak a lot about trading edges in our articles here at Forex School Online because it is something that trades constantly do not understand correctly. Traders constantly fall under the myth that they should be looking for a trading system that hits 100% winners or a system that never makes a losing trade. This for many reasons is impossible and further below in this article it is explained in more detail why achieving an 100% win rate is simply.impossible.

So firstly what is an edge? A profitable edge is nothing more than an Indication of a higher probability of one thing happening over another. In other words, a trading edge is a higher probability of one thing happening over another. The key words are “Higher Probability”.

To be a successful trader you need a profitable trading edge.

You need to have something that will give you an edge on the market. Your trading edge needs to give you an “an Indication of a higher probability of one thing happening over another”. That does not mean that every single trade will work out because we know that is simply impossible, but what it does mean is that when you have your edge it can give you a higher probability of putting you into winning positions to make money and that is the key.

For price action traders their trading edge is the price action setups they use to enter the market and the price action they use to manage their trades.

The next key is to learn, practice and master your trading edge so the “probability” grows higher and higher and with it the profits as well!

 

Anything Can Happen in the Market at Anytime

One of the hardest truths about the market for most traders to get their heads around is that “anything can happen and any anytime”. Whilst most traders consciously know and understand this, they do not trade this way and it often costs them big time in their account balances.

Most traders have trading plans and rules. Some have them written down and some just keep them in their head, but most have some sort of rules even if they are just kept in their head. What is amazing is how often traders will break their own rules for one off trades.

What I mean by this is the trader will spot a trade and say to themselves “just this once I will change the rules for this trade” or “this trade looks so fantastic it just has to work out” etc.

What this invariably leads to is things like the trader risking more than they normally would, not putting a stop in place when they normally do, not closing the trade when they should be because the trade “just has to work out”, not taking profit when they should be, not moving to break even when they should be and the list of rules that get broken goes on.

The market is a beast and it exists for you to make money from it, but don’t just think that because you think something is going to happen it will! Anything can happen in the market and at any minute! The best thing you can do is trade like it! Stick to your rules and don’t go making any “one off” trades.

 

Every Moment in the Market is Unique | The Same Thing Can Never Happen Again

The market will never move the same way again. That may sound obvious, but when it comes to price action trading we are looking at previous price action and patterns. As price action traders to make us a winning trader we need other traders to agree with our trade and push price in the same direction as us.

For example; if I get into a bearish Pin Bar, I then need other people to also get into sell trades to push the price lower to then make my trade a winner. If the opposite happens and people start buying up and price goes higher, my trades loses and I become the loser of the trade.

Every single trader who places a trade is a market factor.

You will never get the same two traders placing the same two trades at the same time and this is why the market will never move exactly the same ever again. It is simply impossible. This is also why it is impossible for anyone in the world to know exactly what is going to happen in the market. Because every single trader has the potential to be a market factor, the only way to know exactly where the market is going would be to know exactly who was in the market and exactly what they were doing I,e buying/selling etc

This is the same reason why we can only have “high probability” setups and not 100% guaranteed setups. This is critically important: No matter how great previous setups that looked exactly the same may have worked out, we will never have the same market participants in the next setup.

The market will never have the same traders in the same pairs and positions again. So whilst that last pin bar that looked exactly the same worked out great, the next one may fail because it has completely different people that are in the market. Every moment in the market is unique.

You must trade within your edge and knowing that you have high probability setups and not 100% guaranteed setups. Never bet the farm and know that because every moment is unique no matter how good a previous setup looked, it has zero bearing on how a future setup will play out because the future setup has completely different market participants.

 

To Make a Profitable Trade You do Not Need to Know What is Going to Happen Next

This is very important and something that is way overlooked by many traders. Traders are forever looking for things to add to their trading. They are looking at news feeds, they are looking for new indicators, new systems, new methods etc The truth is traders not only don’t need all that other junk, they also don’t even need to know what is going to happen next to make profitable trades.

Your job as a trader is not to know what is going to happen next. Your job as a trader is to have a trading edge and to know exactly what that trading edge looks like. We discuss this each week with our trade ideas setups.

Every time that trading edge presents itself in the market, it is your job to pull the trigger and take the trade. You do not need to know what it is going to happen next.

If you have a profitable trading edge you will have a higher probability of the market moving in your favour. That does not mean the next trade will move in your favour and it does not mean the next trade will work out, but that does not matter and has no bearing on your profitability.

This is critical. I recommend you copy it and paste it next to your work station to remind yourself: Your job as a trader is not to know what is going to happen next. Your job as a trader is to have a profitable trading edge and to pull the trigger every time you see your edge play out in the market without hesitation.

 

Conclusion

This article has just discussed some pretty critical concepts that you as a trader really need to have a handle on to succeed in the market. After a period of time it starts coming back to the trader and how badly the trader really wants to become a successful and profitable trader.  How bad do you really want it? Or are you not really fussed?

Are you just happy to float through? Or are you determined to make it and will do everything you can and won't leave no stone unturned until you reach your goals? If you are wanting to become a trader, then commit to that dream and goal and go and do it! Start putting it all together and start taking all the necessary steps that are going to get you to your goal.

If there is a logical step that is going to get you closer to your goal of being a trader, then take it! Start taking the necessary steps and get going! Every moment of inaction is a moment wasted!

 

Safe trading and all the success,

Johnathon

 

Recommended Broker

  • Broker
  • Min Deposit
  • Benefits
  • Score
  • Visit Broker

$200

T&Cs Apply
  • The Lowest Trading Costs
  • 50% Welcome Bonus
  • Award-winning 24 Hour Support
5
Trade Now FreeBets Reviews
Reviews

About Johnathon Fox

Johnathon is a Forex and Futures trader with over ten years trading experience who also acts as a mentor and coach to thousands and has written for some of the biggest finance and trading sites in the world.

View all posts by Johnathon Fox →
Previous Post: « CADJPY Pin Bar & EURUSD Recap
Next Post: NZDCHF Intraday Price Action Setup & CADJPY Pin Bar Comes Off »

Reader Interactions

Comments

  1. Johnathon Fox says

    07/08/2019 at 5:54 PM

    Hi Akala,

    you can find one here; https://www.forexschoolonline.com//beginners-guide-metatrader-4-mt4/

    And on blog page at the bottom you can search for anything you need. The blog is here; https://www.forexschoolonline.com//blog/

    Anything else let me know.
    Johnathon

    Reply
  2. Akala Titus says

    07/06/2019 at 1:19 AM

    I always learned a lot of things from your articles. God will continue to enrich your memories. Please I’m about to start forex trading. I’m just searching online for useful guide. Please I need your help on how to use metatrader 4. Thanks dir

    Reply
  3. Sandi says

    03/15/2019 at 2:07 PM

    This was a very good lesson. I just want to keep reading all of your lessons. I am learning so much.
    I should have learned most of these things by now, never had found anyone that is so thorough. You start from learning how to us MT4, platform (had one coach that said, there was so much free info in the internet, he wasn’t going to waste time with things we could get for free.) I like how you start from the very beginning of forex trading. Those of us who know most of that can go forward.
    Thanks again.

    Reply
    • Johnathon Fox says

      03/15/2019 at 5:54 PM

      Hi Sandi,

      thanks. The best way to explain it is; there is a heck of a lot I wish someone had shown me or I had laid out for me in one spot when I started. I have found over the years there are many others in the same boat when starting.

      Safe trading,
      Johnathon

      Reply
  4. [email protected] says

    09/22/2018 at 10:56 AM

    This is great. Words of wisdom. Thank you, Sir.

    Reply
  5. Kara says

    09/07/2018 at 5:36 AM

    Another lesson learn. great article,
    Great job!!

    many thanks

    Reply
    • Johnathon Fox says

      09/22/2018 at 11:52 AM

      Thanks for the feedback!
      Johnathon

      Reply
  6. Todd says

    12/20/2017 at 4:43 PM

    Spot on Trading Insights. Excellent Article!
    The hard part will definitely be following and practicing it daily.
    Thank You!

    Reply
    • Johnathon Fox says

      12/20/2017 at 9:27 PM

      Heya Todd,

      nice to hear from you and thanks for the comment 😉

      Yeah, but it really is key as it will help you whole trading and the way you think about everything.

      Safe trading,
      Johnathon

      Reply
  7. Thiru Narayanan says

    03/18/2014 at 2:43 PM

    Great article,just started to trade lost 6trade and win 3 so far need to understand the market better.thanks

    Reply
  8. santosh p bawdane says

    01/26/2014 at 12:26 AM

    your artcle is very good ialways wating your artcle actully i do not know english so good thank you very much may god bless you

    Reply
  9. FXAnnie says

    08/19/2013 at 10:05 AM

    Great article. You are absolutely right Jonathan. I need to work toward having an edge rather than trading on a whim. I appreciate the honesty and blunt statements.

    Reply
    • Johnathon Fox says

      08/19/2013 at 11:11 AM

      Ok great well if you have any questions just let me know.

      Reply
  10. kayode says

    08/15/2013 at 12:52 AM

    I am new to forex,have my hands on demo account but had no confidence to trade until i was introduced to FSO. I ready to run with FSO. However the comment/reply are dated 2011. No current comments.,..

    Reply
    • Johnathon Fox says

      08/15/2013 at 1:06 AM

      Hello Kayode,

      the comments are all 2013, 2012 etc don’t know why they are dated as 2011. I have never noticed that, that is odd. Will have to look into that. Considering this article was only published only a month ago it would make it impossible to have comments on it 2 years ago!

      Safe trading,

      Johnathon

      Reply
  11. Imasuen Christopher says

    06/29/2013 at 8:33 AM

    you are simply GREAT too sincere and truthful God bless u.

    Reply
  12. Ronda says

    06/27/2013 at 1:17 PM

    I am very new to trading. I found your website before getting overwhelmed with all the forums etc. I have read everything on free portion of your website. I have downloaded the metatrader 4. My question, where is the best resource to learn the metatrader4 software? Is that part of the membership only training? I want to be comfortable with the software and my chart set ups before trying to master a trading strategy in the members only trading. Thank you for your help on where to go next.

    Reply
    • jonfox says

      06/27/2013 at 3:48 PM

      Hello Ronda, I have replied to you regards this in more detail in email. Thanks for your comments and safe trading.

      Johnathon

      Reply
  13. Piet Botha says

    06/24/2013 at 6:32 AM

    Dear Jonathan,
    Thanks for your continued efforts to help me and others suffering the markets like me. I’ll do my best to follow this advice and hope to see results soon. I do need a boost for a change. Thanks again for your support.
    Piet Botha.

    Reply
  14. Victor says

    06/23/2013 at 10:47 PM

    I love all your work and becoming your member was the best thing I ever did for my trading as that was the moment it turned around. Thank you so much Johnathon.

    Reply
  15. Dave says

    06/23/2013 at 10:45 AM

    Hello Sir Johnathon
    I enjoy all your article ,you keep things simple,highlight the most important factors as a trader and give great motivation.
    Thankyou

    Reply
  16. Majinquo says

    06/23/2013 at 12:55 AM

    Awesome article.That section about not needing to know about what is going to happen next to be a profitable trader is eye opening. Starting to now put it all together.

    Reply
  17. Nolan says

    06/22/2013 at 11:12 PM

    Thanks John great article

    Reply

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Footer

Get Our FREE Course, Bonus Strategies & Indicators!
X
Join Us Now!

Your capital is at risk.

X

CORNERSTONE LESSONS

Forex Trading for Beginners

Price Action Trading

How to Trade Forex

Technical Analysis

Forex Charts

Forex Trading Strategies

Money Management 

Compare Brokers

Best Forex Brokers

Forex Demo Accounts

Best Forex Trading Platforms

Forex Apps

Swap Fee Accounts

MT4 Brokers

CATEGORIES

Forex Videos

Trading Lessons

Weekly Trade Ideas

Start Here Guide

ForexSchoolOnline.com helps individual traders learn how to trade the Forex market

WARNING: The content on this site should not be considered investment advice and we are not authorised to provide investment advice. Nothing on this website is an endorsement or recommendation of a particular trading strategy or investment decision. The information on this website is general in nature so you must consider the information in light of your objectives, financial situation and needs.

Investing is speculative. When investing your capital is at risk. This site is not intended for use in jurisdictions in which the trading or investments described are prohibited and should only be used by such persons and in such ways as are legally permitted. Your investment may not qualify for investor protection in your country or state of residence, so please conduct your own due diligence or obtain advice where necessary. This website is free for you to use but we may receive a commission from the companies we feature on this site.

We Introduce people to the world of currency trading. and provide educational content to help them learn how to become profitable traders. we're also a community of traders that support each other on our daily trading journey

Forexschoolonline.com is not a financial advisor. Do your research before investing your funds in any financial asset or presented product or event. We are not responsible for your investing results.

Finixio Ltd, Tower 42, 25 Old Broad Street, London EC2N 1HN | [email protected]

Copyright © Forex School Online - Finixio Ltd Company no. 11705811 - Sitemap  - Privacy Policy - Disclaimers & Terms of Use - CONTACT US