Zerologic
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In technical analysis, most traders use indicators as a tool. First, traders must study the forex indicators that will be applied to the chart, how to use them, the function and meaning of the signals given by the indicators, but also evaluate the accuracy of the indicators and draw conclusions from performance metrics.
Start with simple objectives from your charts - identifying uptrends and downtrends, and assessing which trend is more likely to continue. Look back over maybe 3 months to identify the longest and smoothest trends.
We already know that statistically, price in a trend is more likely to continue that trend than go sideways or move in the opposite direction. This gives you an edge immediately since you now know what the market will probably do tomorrow and over the next few days.
You have choices at this point, the first being whether you buy an uptrend immediately you see it, or whether you wait for price to pull back a little. If you watch for a pullback in an uptrend you can set a buy order above where price falls to so that you will only be opening a new position if price rises through your order level: so if the trend fails just as you spot it, and price does not go up again, you will have lost nothing.
We already know that statistically, price in a trend is more likely to continue that trend than go sideways or move in the opposite direction. This gives you an edge immediately since you now know what the market will probably do tomorrow and over the next few days.
You have choices at this point, the first being whether you buy an uptrend immediately you see it, or whether you wait for price to pull back a little. If you watch for a pullback in an uptrend you can set a buy order above where price falls to so that you will only be opening a new position if price rises through your order level: so if the trend fails just as you spot it, and price does not go up again, you will have lost nothing.
