guessing game?

Does trading is just another form of a guessing game?

I've been thinking a lot about that and i would like to hear your insights about this one.

Thanks!

Educated or un-educated guess? The choice is the individual traders.
Mark Douglas states:

The Five Fundamental Truths…

1. Anything can happen.
2. You don’t need to know what is going to happen next in order to make money.
3. There is a random distribution between wins and losses for any given set of variables that define an edge.
4. An edge is nothing more than an indication of a higher probability of one thing happening over another.
5. Every moment in the market is unique.

…and The Seven Principles of Consistency

1. I objectively identify my edges.
2. I predefine the risk of every trade.
3. I completely accept the risk or I am willing to let go of the trade.
4. I act on my edges without reservation or hesitation.
5. I pay myself as the market makes money available to me.
6. I continually monitor my susceptibility for making errors.
7. I understand the absolute necessity of these principles of consistent success and, therefore, I never violate them.

"An Edge is nothing more than an an indication of a higher probability of one thing happening over another"

I find Forex more like a Chess game.

Depends on who the trader is.... ... I see it more like calculating and managing risk. It comes down to a good strategy, a trading plan, risk & money management, and discipline.

It is a guessing game, but you can make educated guesses.

I have seen results from Monte Carlo simulation engines that if you randomly open a position you have as much chance of being right as of being wrong (actually losing money because of spreads and comissions).

However, using simple indicators like a moving average (lets say when a short moving average is above a slow moving average) you increase the odds that by randomly opening a long position you will have more chances of being right.

I'm not adept of randomly opening positions and of course just by this method you're not giving yourself that a huge of advantage in the % of "rights vs wrongs" but still it can be called an "hedge".

So it is a guessing game, but if you study the market you'll eventually find ways of making educated guesses. Then you will need to learn about money management so that when you get "unlucky" you don't incur into risk of ruin.

All the above replies I agree with and in particular mrgreen's reply is, as usual, on the nail. Even though it's not original (maybe he is?!) he's identified the answer. It's about calculating probabilities. And a lot more.

Well, since i don't know how to play Chess, how come you find Forex more likely a Chess game? sorry for the dumb question, I just wanted to visualize how the two works..

Thanks for this..Really a very helpful guidelines..

My guess is...
The More you study the Market, the Less of a Guess it is.

{When you have been looking at charts for > 20 years, it seems obvious. A little tougher when your Experience Depth is < 50 Weeks. Play Smart and plan toward still doing this when you are > 250 Weeks into the Market.

The Esscence of this game is similar to grains of sand on the beach. 1 grain means nothing. You need lots & lots before they amount to anything but you Must remember, "Add 1 grain/Trade, and you will be amazed at the beach you build in your lifetime."}

Okay.. thank you for all your insights.. I appreciate it..