The Forex crowd and is it worth following it?

In any financial market there is such a thing as a crowd, but you should not always succumb to its influence and blindly follow it.

It is following the crowd that most often leads to losses or loss of profit, so you should first carefully study the current situation and only then make a decision.

Forex is a virtual exchange, so when making transactions, the trader is not present on the real trading floor, but psychological pressure still remains. Its influence can be understood through a concrete example.

Typically, inexperienced traders who use intuitive trading find themselves in a similar situation.

Example: There has been an upward trend in the market for a long time; a trader, seeing that the price is rising, enters into a buy deal.

In fact, the daily high has already been reached and the market is in the overbought zone. After a short time, a reversal occurs and the price sharply rushes downward. As a result, the transaction turns into a losing one. In order to avoid falling into such situations, you should base your trading not on market sentiment, but on the results of technical and fundamental analysis.

It is also a mistake to use so-called order informers, access to which is provided by some Forex dealing centers .

The trader, seeing that the majority of market participants have opened short or long transactions, tries to follow their example. But we must not forget that only 5% of traders are successful traders, and it is not at all a fact that they are currently trading according to the trend and it is possible that you will not guess on the right side. Therefore, when searching for entry points and determining the direction of transactions, you should take into account only these indicators: the width of the price channel, the main lows and highs , the latest important news and the likelihood of new messages being released.