No matter what method you use to trade the forex market, one thing is for sure, trading from a confluent level will greatly increase your odds of profiting. Price action analysis traded from confluent levels is one of the highest probability trading methods you will find. Price action analysis makes use of a raw price chart with virtually no indicators. To find the most confluent signals we look for areas where price action signals coincide with support or resistance, trend lines, (and) or Fibonacci retracement levels.
Waiting for our price action setups to occur at confluent levels is the most accurate way to trade forex. When we trade in this manner we are acting like snipers; patiently waiting for the target to move into our crosshairs and then calmly pulling the trigger to execute our trade. In this way we greatly increase our winning percentage and more quickly grow our trading account. This is in direct contrast to the way many aspiring forex traders behave; overtrading and randomly entering and exiting trades after their self-discipline breaks down due to an ineffective method (and) or a lack of self-control. We could compare most traders to a person blindly shooting their bullets in a panic, not hitting the target and then being totally out of ammunition when the perfect setup eventually forms.
The necessity of a simple and effective trading method to navigate the turbulent forex market cannot be overstated. When we combine a truly simple yet effective method like price action analysis with confluence of levels we get a deadly combo. The patience needed to wait for well defined price action setup to occur at a solid confluent level is a rare quality indeed. Price action analysis can give you the method that will allow you to profit if you have the necessary self-discipline to not over trade and manage your risk effectively. It pays to get a quality education in the art of price action analysis, once you become trained in this trading method you can start to design your own trading plan that makes use of confluent levels to increase the probability of each setup.
Confluence of levels will enhance the effectiveness of any trading method, the problem is most trading methods make use of lagging indicators or ridiculous counting methods that only do more to confuse and frustrate traders than to help them. Price action analysis is the most effective method that makes use of a simple price chart. The reason is that you are trading off the data the market generates about itself. There are many easily spotted clues to future market direction that are apparent to the person trained to spot specific price pattern setups. Support and resistance, Fibonacci retracements, and trend lines can be used to trade the forex market without any further method involved. However, combining these levels with price action is the closest thing to a perfect forex trading method that you will find. The natural rotational movement of forex markets is best unveiled by price action signals formed at confluent levels.
Nial Fuller is a Respected Trader and Forex Coach. He runs a Forex Training and Education Website, Visit his site here Confluent Forex Trading with Price Action