All Wrapped-up or Naked Charts?
One of the most recurring questions that I get either from new or intermediate traders is related to the expected accuracy of this or that technical indicator. Almost every trading system seems to be based on one or more of these instruments of measure, which will show different relationships between general market behavior, time and price itself.
At a certain point of their own learning curve, I believe each and every trader has been through the dilemma of finally finding the "best" indicator which will get the Holy Grail into our hands with little effort. After a while and possibly some losses, what's left is the confusion that arises when the charts are so much clogged of all possible trading widgets, losing sight of which of the elements has truly the leading role.
The only main highlight in Forex and ANY system is the PRICE. Indicators are stepping stones and crutches and helpful borders but in the end by themselves none will ever get you a 100% success rate. You have to be aware of supports, resistances, pivots, and all the rest, as for example which time of the day it is, how many markets are open, are there news or not, what has been happening lately in the political and economical scene of currencies involved... all those little details that fall in place when you have seen enough price action to understand how and why price behaves for a particular currency pair.
More than a sentence engraved in marble, each one of the indicators can be just that, a mere "indication" that there MIGHT be an opportunity to enter a trade IF some conditions are fulfilled. But in the end it is your own experience of that particular market which will tell you if it's time or not to enter or exit. And above all, your consistency in applying your trading plan and the rules of the system you chose to work with, will be paramount.
Some of those indications have precedence over others, a very few are leading, most of them are lagging... some are stronger almost all the time, but never ALL the time. No trade is the same ever, despite some level of predictability. But the more instruments and tools you learn to master, the easier it will be later on to see which of all the situations is present on a specific trade.
Trust the Price, watch the Trend and just strip your charts bare!
At a certain point of their own learning curve, I believe each and every trader has been through the dilemma of finally finding the "best" indicator which will get the Holy Grail into our hands with little effort. After a while and possibly some losses, what's left is the confusion that arises when the charts are so much clogged of all possible trading widgets, losing sight of which of the elements has truly the leading role.
The only main highlight in Forex and ANY system is the PRICE. Indicators are stepping stones and crutches and helpful borders but in the end by themselves none will ever get you a 100% success rate. You have to be aware of supports, resistances, pivots, and all the rest, as for example which time of the day it is, how many markets are open, are there news or not, what has been happening lately in the political and economical scene of currencies involved... all those little details that fall in place when you have seen enough price action to understand how and why price behaves for a particular currency pair.
More than a sentence engraved in marble, each one of the indicators can be just that, a mere "indication" that there MIGHT be an opportunity to enter a trade IF some conditions are fulfilled. But in the end it is your own experience of that particular market which will tell you if it's time or not to enter or exit. And above all, your consistency in applying your trading plan and the rules of the system you chose to work with, will be paramount.
Some of those indications have precedence over others, a very few are leading, most of them are lagging... some are stronger almost all the time, but never ALL the time. No trade is the same ever, despite some level of predictability. But the more instruments and tools you learn to master, the easier it will be later on to see which of all the situations is present on a specific trade.
Trust the Price, watch the Trend and just strip your charts bare!
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