The perfect way to use the indicators in forex trading
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July 31, 2017 at 11:20 am #4841
Trading is considered to be one the most sophisticated business in the world. If you know how to trade the market then you can make a huge amount of money. But mastering the art of trading is extremely difficult since you need to have control over lots of things. Most of the retail traders jump into the online trading world without knowing much about the market details and thus they fail to make money. The professional Aussie traders have spent huge amount time in educating themselves with the perfect knowledge of this industry. They know very precisely that without learning the market basics they will never be able to place the perfect trades. Unlike the expert, the novice traders tend to trade with indicators based trading system and thus lose a huge amount of money. Some even say that indicators are just waste of time but in reality, it can be extremely handy if used in the right way.
Indicators are just helping tools
The novice traders in the financial industry consider indicators as their prime trading tools. They simply use too many indicators to find the best trading signals. But when you load up your trading charts with too many indicators you are just making thinks too much complex. The expert traders at Saxo hardly use one or two indicators in their trading for filter the best quality trades. They never rely on the indicators readings only but they consider it as helping tools. You need to have complete knowledge about the support and resistance level to execute your orders using the indicators reading. If you trade based on indicators reading only then you will have a tough time in this industry.
Use only one or two indicators
Indicators should be used in the right manner. As a currency trader, you should never use more than two indicators reading in your trading chart since it will create an extreme level of confusion while making the financial decision in the execution of the trade. Some of the traders often use custom indicators but before using that make sure that you have back tested your trading system by using demo trading account Australia. Back testing should be done at least for one month it needs a good number of sample to declare a trading system as a stable one. If you use custom indicators then you need to always look for an updated version of the indicators so that your trading system easily gets adapted with the changes in the market.
Use price action signal
Price action trading signal can be extremely useful when traded with the simple moving average. The SMA is the most powerful and reliable indicators which give the traders precise knowledge about the dynamic support and resistance level. In the eyes of the trained professional, the 100 and 200 days SMA are considered to be the most used indicators in the forex industry. So if you any other value in the indicators settings then make sure that you back test it in a demo account. Once you have the perfect dynamic support and resistance level you can use the price action confirmation signal to place your high-quality trades. Though it’s extremely reliable you should never risk more than 2 percent of your account capital on any single trade. Try to learn the advanced money management system since it is the best way to trade the dynamic support and resistance level. But when you use the candlestick pattern to execute your orders make sure that you trade the higher time frame.
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