|Sunday, 16 May 2010 16:28|
There are large numbers of traders who believe that live Forex charts are essential for their trading systems. Some even go further to believe that if you can master the charting techniques, you will certain forecast the future price of a currency pair.
In order to compare whether the trend is upward or downward and also to analyze which pair is trending towards the same direction, the live forex charting window is a very beneficial instrument for every trader to take full advantage of it and be a successful trader.
I agree with the fact that forex charts can be beneficial to traders, but there is much more to know to be a successful trader. I do not believe that charts can be used to predict the outcome of price action. But what I do believe is that they do help to make an educated guess towards where the prices are heading.
There is a lot of information on charting patterns. You must have heard some of it. They are double bottom, triple bottoms, and triangles. Knowing such information is very subjective. In my view they are not reliable enough to depend solely on them to make your trading decisions.
There are many forex courses available that many professionals undergo. One such course is from a well renowned technical trader. The course takes only few weeks to complete. It consists of few manuals and many videos. The course developer suggests some actions to be taken on a chart pattern, but later on he suggests entirely different action on the same charting pattern.
Here the point I like to mention is that having trading methods that needs the interpretation of the single trader should be avoided. I mean to avoid such approach. As this is not the way to become a professional trader.
I think to make profits some people may use charting and some other indicators but certainly it’s not every one’s domain. For majority of traders this is not the right way to go. People who like to trade in black and white with forex should not depend on charting patterns.
Charts are useful to observe the market, such as to determine the trends of the main currency pairs. This is the kind of information you can get from these charts. For short term trading, the most appropriate method to trade is to buy and sell with the trend. Never trade against it.
To analyze whether the currency pair is trending up or down go and examine which pair is trending in the same direction on its hourly chart. Prefer the trade where a currency pair matches with these two trends.
Live Forex charting is a very useful tool kit for every trader. Knowing how to effectively take full advantage of it will make the difference in becoming a successful trader.