The Ultimate Video Game
By Gordon Philips, Director of Trading and Research
Institute of Higher Earning
Thinking about trading in the Forex market? Are you good at playing video
games? If so, you may be superb Forex trading material already and just not
know it yet.
Legions of game fanatics the world over battle it out each day playing a
bewildering and growing assortment of video games. Heads fly (literally),
monsters are slain and alternate worlds created in a new millennial
cyber-reality that already has attracted millions of online gaming
enthusiasts.
This is a far cry from this author's teenage hours spent haunting a
neighborhood video arcade. In those bygone days (the Dark Ages; circa 1960)
we had no bloodthirsty Ninjas to worry about. Our greatest concern lay in
not tilting the table and prematurely ending a game of Frogger, especially
if the owner was looking!
Although separated by half a century, the three main ingredients shared by
video games of these two eras are competition, pattern recognition and point
accumulation. And there we have just defined the very essence of Forex
trading!
For what is a currency trading chart if not a visual battlefield littered
with the corpses of crashing red candlesticks and the fallen buyers slain
with them?
Some writers have compared Forex trading to medieval jousting, with each
trader trying to knock the other off of his charging, snorting mount with a
long pointy thing called a lance. Which reminds us of some really scary
spikes we've seen on economic announcements.
We like to think of Forex trading as akin to the movie 'Jaws' (hum the sound
track to yourself here) with the beginning trader playing the role of a
minnow hiding at the bottom of a lagoon, hoping a few scraps of food will
filter down uneaten by the looming shapes circling overhead.
You've got a $1,000 Forex trading account and Chase Manhattan has
$10,000,000,000. Think Peewee Herman lost in Jurassic Park and you've about
got it right.
In Forex, it's 'winner take all' in a heroic battle for pips. There is no
consolation prize from Don Pardo and no bouquet of roses for the second
runner up. You either survive or you die. Kinda' like when Pudgie Ryan and I
use to battle each other for top position on Donkey Kong.
Forex trading (this is true of all forms of trading, really) is what is
called a 'zero sum' game because there is always a winner paired with a
loser. No, that's not done intentionally, but that's sure the way it works
out.
Each trade must have a buyer and a seller to take opposite sides of the
transaction, otherwise there is no trade.
It really cracks us up when a TV talking head says 'Today's stock market saw
more buyers than sellers.' Oh, really? And what were all those excess
sellers doing? Donating their positions to the Salvation Army?
Forex is definitely a multi-player game: just you and a few million other
trading maniacs each trying to annihilate the other guy. Want a perfect
description of a Forex trade? Envision the winner reaching through his
computer monitor, grabbing fistfuls of pips off of the loser's plate and
getting away clean. The Forex version of Grand Theft Auto.
Now, if you're new to Forex trading and considering getting started, by all
means do not allow my comments to deter you for even the briefest moment. We
need people like you to take the other side of our trades. Only kidding.
Truthfully, because today's electronic clearing houses anonymously match
buyers and sellers together, it's not possible to know which other Forex
trader perforated your suit of armor, removed your head or stole your
dinner.
Which means that the littlest David can go toe-to-toe with the biggest
Goliath and clean his clock. If you're experienced and nimble enough you can
hand the world's biggest players their heads (or pips) on a platter. Think
Quake and you're Rhino Squad.
The best news of all is that, unlike video games with complex
three-dimensional action and graphics, Forex charts can only go in two
directions: UP and DOWN.
Students at the Massachusetts Institute Of Technology lounge around the 'rec'
center reading Wired Magazine while playing three-dimensional chess for
relaxation. Compared to this, Forex is more like checkers on steroids. Which
is why anyone who is willing to devote the time to learn how the Forex
flippers operate can be successful.
Did I say flippers?
Forex trading is really all about pattern recognition, which makes teenagers
eligible to clean up in the spot currency market.
Are you over the age of 40? Have you ever tried to beat a teenager at a
video game? Point made.
But that doesn't mean an old codger like me can't trade well, too. All we
have to do is remember whether to buy or sell when we see a juicy
candlestick formation forming right on a long term trend wall , kinda' like
we used to have to remember what to do every time that little PacMan guy
climbed to the top of that last row on the right ...
