The trader mentality is very different from the shopper mentality. As a shopper, if you are looking for the right time to go for shopping, you wait for the season of sales. When everything is half off and the choices are flowing, that’s the best time to go shopping. You would never shop in a store that not only did not have the coveted ‘sale’ sign on, but in fact had their prices hyped up.
Why people buy high and sell low?
This is what traders do when it comes to their favorite stocks. When the prices are going down, traders and investors frantically start selling their shares. Whereas they make buy calls when the price is climbing up. The tried and tested method of shore shopping does not work.
Many novice investors come to the market with the idea in mind that with very accurate scalping indicator, they can predict an uptrend and decide the ideal time to buy. Greed and fear clouds the judgement of novice traders and they make rash judgements when they look at their trading screens. Many end up losing their hard earned money in the market because they are impatient and trying to cash in quickly from any uptrends in the market.
How to use the time tested shopping strategy in forex?
Momentary uptrends can only last so long and when you buy high prices, the sustainability is low, which means you end up losing as the trend falls. Like normal shopping, the key to getting a better price in forex is patience. You wait all year round for the season of sales to grab the most lucrative deals. Likewise, wait for the currency you want to buy to become cheaper and then sit on it.