The price always moves according to different patterns, but they are always changing. Thus, it may well be that the price moves upwards with slight upward movements.
Suddenly, an event occurs, there is a change of direction and the market drops in a steep downward movement below the mark from which the upward movement originally started. If the trader looks at his price chart, he will notice that each type of movement has its own characteristics and none is exactly like the other. The fact is that the market can only move in three directions.
Downward, upward and sideways. While the market does, it never does so in exactly the same way. The trader must figure out what is currently going on in the market and what situation it is in. It is quite possible to work out a good trading plan for each market situation, this is the only way to make long term profits in Forex trading.
Each downward, upward and lateral movement has very different characteristics. However, this is not decisive. It is more important that the trader is aware of these characteristics, because only then he knows exactly how the market is really moving. The trader must be aware even if he does not understand the broker, because only then does the trader know when and where to exit the market.
