XM Forex Penguin
XM Forex Penguin

Is There a Holy Grail of Forex Methods?

Last Updated: Jul 13, 2022 @ 12:31 am

Sometimes, you will hear people talking about the “holy grail” of forex trading.

In theory, the “holy grail” is a forex system that is so foolproof, so consistent, that it is just about perfect.

Some people may define the holy grail as a system that lets you win 100% of the time.

Others may simply define it as a method that provides strong consistent returns with little to no effort.

Regardless, there is one thing we can say with certainty about the holy grail of forex trading: it does not exist.

In this post, we are going to explain exactly why there is no such thing as a forex holy grail.

We will then offer some recommendations for trading profitably in a world where such a thing does not exist.

Reasons Why a Holy Grail of Forex Does Not Exist

1. The future is unwritten.

The first reason there is no such thing as a holy grail is that nobody knows the future. Nothing is set in stone. No matter how good a person or an algorithm may be at making sound predictions, sooner or later, the unexpected will happen. Life is chaotic, and markets do strange things.

2. No system is ideal for all market conditions.

There are trading methods that are versatile enough to be used in a range of scenarios, but you are not going to find a system that always works in any situation.

In general, it is hard to trade when markets get choppy and feature a lot of whipsaws. Methods that work well in smoother markets may not deliver profitable results at all in choppy markets.

Plus, market conditions for any given currency pair can change gradually over time. A system that was optimized for conditions three years ago may not be optimized for conditions today—even if those conditions are tradable.

3. The human element will always come into play.

Markets exist because of human economics. There is no getting around the fact that human beliefs and reactions move prices. While human behavior may sometimes seem predictable, at other times, it can defy expectations. And it is certainly complex. No algorithm, no matter how sophisticated, can fully account for its influence on the markets.

Recommendations for Success Without a Forex Holy Grail

Hopefully, you now understand why there is no such thing as a forex holy grail. With everything we just discussed in mind, let’s go over a couple of best practices for continuing to move forward realistically with your trading.

1. Do not waste time looking for a perfect system.

Before you can start trading forex at all, you do need a trading method or system. Naturally, you want it to be able to produce incredible results. But it can be challenging to figure out when to draw the line at “good enough.”

At least now you have the perspective to know that one thing no trading system will be able to provide you with is perfection. There is no point, for example, in trying to shoot for a win ratio of 100%.

In truth, it is hard to make it as a forex trader. As we like to say over and over, trading may be simple, but that does not make it easy.

So, if you are getting consistently profitable results with your trading method in backtesting and demo testing at all, you may seriously want to consider going live, even if those results are far from “perfect.”

If you continue to search for a perfect system or something close to it, all you will be doing is wasting valuable time you could be spending making money trading with the system you already found.

Over time, you can continue to work on improving the system. You can also always look around for better ones.

2. Do not throw away a decent system just because it “broke.”

Believing in a forex holy grail does not just teach traders to underestimate the values of new systems that are working reasonably well. It also can lead them to underestimate the value of an existing system that has worked well for a while and recently stopped performing.

The reality is this: times change. Market conditions change. Systems optimized for one set of conditions may struggle in the new conditions. There is no such thing as effortless profit. Now and again, you need to work on your trading method.

So, resist the urge to throw out your system just because you are having a hard time with it. While there are some scenarios where you might eventually need a new trading method, there are many where you will not.

Chances are good that you will make much better use of your time tweaking your existing system so it can perform in the new market conditions than you would be chasing off again after the forex holy grail.

How Do You Find a Profitable Trading Method?

If you are just getting started on your trading journey and still do not have a forex trading method, there are many places you can find viable strategies. Quite a few of them are free. To get started, take a look at our post, “Where Can You Find a Forex Trading System?


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