Scrub that chart clean, start again and keep things simple!ĭon’t mess your chart up with masses of support, resistance or trend lines – you’re only going to make interpreting the charts harder for yourself. If you can’t remember what level is for what, and you’ve got colored spaghetti all over your chart – it might be time for a ‘detox’. They may not be able to read your analysis because they simply don’t understand your system, or your chart just may look like a war zone of data which confuses them, which means it’s likely to confuse you too. Other traders should be able to take one look at your charts, and understand exactly what you’re trying to communicate.Īsk a fellow trader to check out your charts and get their opinion. You will often see my Forex charts with only one or two horizontal lines on them.Īlways keep your analysis clear and concise for your own benefit. The ‘one level’ approach can be a very effective way of simplifying the way you mark support and resistance levels. We could probably extend this a little by marking out the next support level here, but we wouldn’t need to go any further than that. I am confident the above chart communicates my analysis clearly, even with just this one level. If you’re really struggling with where to mark your levels, ask yourself this question: “If I was only allowed to mark one level on my chart, where would I set it to best highlight my analysis”. In our last lesson: 4 Support & Resistance Mistakes That Screw Your Charts Up, we talked about how marking more than a few lines is enough ‘tip the scales’, and make your chart look confusing. This has got to be the quickest way to make a mess of your Forex charts and make interpreting your analysis a nightmare – yet there are a lot of traders still committing this sin. If you ever feel like you’re losing grip of your trading, do yourself a favor and refer back to this article to give your Forex trading a clean-up.ĭon’t Go Crazy with Support & Resistance Levels or Trend lines Today I wanted to share some tips on how you can keep your trading simple and effective. Most traders initially believe that by making their systems increasingly complicated, they’re making positive steps to improve their trading in an attempt to ‘out smart’ the rest of the herd.Īll this really achieves is: taking on more workload than necessary, making an analysis more difficult and confusing, and it turns the relatively straight-forward task of making a trading decision into a much more stressful and difficult process. It is human nature to try to over-complicate tasks to try gain the competitive edge. This is a well known acronym spanning across many industries.
0 Comments
Leave a Reply. |
Details
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |