When You Look at a Forex Trading Chart Can You Tell What is Going On?
When I first started trading Forex I spent hours drawing trend lines trying to figure out what price was going to do. I read everything I could about trend lines but no matter how I drew them or how many I drew, prices never seemed to obey them.
There is a very good explanation for this. It hinges around how many other traders in the world are looking at the same trend line and in fact have drawn the same trend line as you and are trading off it. The answer is, not many. Yes, occasionally it does happen, but traders get tricked into thinking that many of the tools used in trading and Forex trading have meaning when they don't.
A trend line really only does one thing and that is provide a line in the direction of trend over some period of time. When you think of all the nuances involved in drawing them it should become plain to see that they are not a relevant tool for making a determination of what is happening on a chart.
Recently I was directed to a trading forum that was trading naked. No, no, not naked naked but price naked, without helps or so I thought. The first chart had 3 indicators, 4 moving averages, pivot points and that was not all. Looking at that chart it would take an hour just to explain all the intricacies of what was supposedly happening.
When a trader looks at a chart he wants to know which way price is going, when to get in and when to get out. Even a trader trading the daily charts, or longer, needs to have a way to enter the market with the least risk and the least draw down.
RSI, the Relative Strength Index has 4 trading signals which are little known and little used but are powerful trading signals that allow any trader with a short education to know what is happening on any chart. And with the use of an indicator called The RSI Paint Indicator, it can be even faster. These 4 signals tell the trader which direction the market is going, when to enter and when to exit. It really doesn't get any easier and there is no need to add additional indicators which only confuse the issue.
Look for a trading method that allows you to make a simple but effective analysis of a trading chart, one that will earn you money.
Questions and Answers
When I started in Forex, I wouldn't have known a good Forex trading system if it had walked up and slapped me in the face. Would you? Many traders I talk to have studied trading for many years, have taken expensive courses on how to trade, spent more money on trading systems, read many books, traded hundreds of hours if not thousands and still lost money.
I trade Forex everyday and I teach Forex everyday and the most significant thing that helps losing traders become winning traders is reducing the number of indicators on their charts, learning to trade 4 RSI signals and understanding that a trade without momentum is not a trade.
Can you imagine trading and seldom getting a trade wrong? Can you imagine that it happened at about the same time each day so you didn't have to sit in front of your computer and watch hour after hour? Better yet can you imagine trading and getting the direction of the trade right more often than you got it wrong and that when you entered a trade momentum in the market immediately moved price in the direction of your entry and put you in profit?
What do you know about the indicator or set of indicators that you use when trading Forex? Have you actually made a list of the things that they tell you about what price is going to do? When was the last time you knew with a better than 70% chance that price was going to go in the direction you predicted and you knew why?
Is it possible to trade one hour a day in Forex and make money? Many people who want to trade Forex don't have the time to trade all day or even part of the day. So can you trade one hour a day and make money, perhaps enough money to live on?
The Forex currency market is a non-centralized exchange where banks, businesses, governments, investors and traders can trade currencies with one another. By "non-centralized" I mean there is no actual physical centralized exchange like the New York Stock Exchange or the Chicago Mercantile Exchange. Instead...
The fully automated service sends an email confirmation in receipt of the amount and then processes the order. Among the reputed agencies to order foreign currency from is Pawnbroker.
Created by David Lambert, the CCI was first used as an indicator for determining reversal points in the Commodities Markets. It was then discovered to be very useful in the share and forex markets. It is based on the theory that all activities move under the influence of cycles. The Maxima (+100) and the Minima (-100) occurring at regular intervals. The CCI measures the speed of price fluxuations as determined by oscillators.
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A merchant cash advance is a cash payment to a business in exchange for an agreed upon percentage of future credit and/or debit card sales. This relatively new industry provides business owners quick access to capital coupled with benefits not see with traditional loans.
What do you know about the indicator or set of indicators that you use when trading Forex? Have you actually made a list of the things that they tell you about what price is going to do? When was the last time you knew with a better than 70% chance that price was going to go in the direction you predicted and you knew why?
When I started in Forex, I wouldn't have known a good Forex trading system if it had walked up and slapped me in the face. Would you? Many traders I talk to have studied trading for many years, have taken expensive courses on how to trade, spent more money on trading systems, read many books, traded hundreds of hours if not thousands and still lost money.
Not everyone plays baseball that trades Forex but they have a lot in common. To become a good trader in Forex you have to think like a good hitter. Good hitters have a "best" pitch to hit. They also have a pitch that is "almost best" and then it goes down from there.
Depending how you started in Forex and depending on your method of trading, you may have begun to trade live already. But if you haven't traded live and you are wondering when the right time would be, perhaps this article will be of help.
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