Things You Need To Avoid In Technical Analysis
Technical analysis itself tends to monitor market movements using price charts that are already available on the trading platform. In addition, technical analysis also uses forex indicator tools that are available on each platform. Sometimes there are still many new traders who have not been able to master full technical analysis.
The following are some things that need to be avoided in using technical analysis. Such as :
Using Too Many Indicators
This is most often done by new traders, which is to use many indicators. They assume that using many indicators in analyzing can provide accurate signals. But keep in mind, the more indicators and tools used in analyzing will make you even more confused.
Suppose you use 5 indicators at a time and at one time 3 indicators give a sell signal. You do not immediately open sell positions but still wait until the 5 indicators give the same signal at one time. And when the 5 indicators give a sell signal simultaneously you immediately open a sell position and at that time the downtrend is almost over. Is this good for the growth of your portfolio? Certainly not.
Many professional traders only use 1 to 2 technical indicators in their trading system. Some even don’t use any tools and only see forms of candlesticks. Now for those of you who are just learning how to use technical analysis. Make sure the price chart in front of you is not too full by tools and indicators. Make the trading system as simple as possible which can provide open and exit signals as quickly as possible.
Not Understanding the Function of Indicators Used
I’m sure when you enter a myriad of indicators in the graph you don’t really understand the functions and characteristics of all of them.
Before you use indicators, make sure you understand correctly about the settings, functions and how to use them. If you already understand about the indicators that will be used, then later you will easily trade and collect profits consistently.
Simple and Easy to Apply
Every technical indicator or forex trading system that uses various indicators was created to help forex traders. The system is made so that the analysis carried out can produce profit consistently. Lots of indicators or trading systems that are created and shared free of charge by the makers. But there are still many traders who use indicators and the system can’t even use them even often. This is not one of the indicators or the system, but you are the one who doesn’t understand the function and how to use it. Search or create a trading system or indicator that is simple and easy to use. Display charts that look interesting but don’t provide consistent profit are certainly useless right?
Lazy Learning About Forex
Every job certainly requires learning on a field that is occupied not. Like other jobs such as doctors who must learn about medicine. Architects who must study architectural and civil engineering. Forex trading is also a job that requires prior learning and practice in the field of currency trading.
There are two ways to achieve success in this world, the first is talent and the second is hard work. If you have talent in forex trading or financial investment, you only need to practice your trading skills. Then what if you don’t have talent? Of course you have to work hard to be successful at this job. As with hard work, talent also requires learning in advance for success. So the point is if you want to succeed in a job, one of which is forex trading, then you must learn forex first. Everything won’t happen if you keep quiet.
Those are some simple things you can do in using technical analysis. Hopefully it will be useful for your forex trading success.