The Market as a Process
My mentor, Charles Goodman, of whom you will learn more in The Goodman Method of Trading, was an advocate of thinking of the market as a process no matter what your trading space or profile might be for your FOREX career. This idea, which you will want to use as a paradigm for your trading, is not cut and dried either, but a little touchy-feely and difficult for many new traders to grasp.
Think of the market as a movie, Charlie used to say to me.
What do you need so that when you come back in to the theater you can quickly catch up on what has happened while you were away? For the scalper and guerilla, this is less important. For the day trader and position trader, it is mission-critical. You want to see what has occurredâthe market's theme, plot, and character developmentâand ease back into watching with minimal delay.
An adequate means of keeping track of the market-as-movie is very important at higher trading profiles but still useful for keeping your rhythm at lower trading profiles. It is simply good practice to give your trading such a holistic approach. Process helps put the pieces of your trading plan together coherently. It is especially useful when it comes time to periodically review, diagnose, and make small changes to your trading.
FOREX: Setting Up Shop, will give you some tools to manage your process and track the market effectively.
Tip: This is a big one; at this point you need to take it on faith: ignore the market process at your own risk! It is very important. I have had students who struggled for weeks and finally have a eureka moment, seeing in a blinding flash the importance of the process.