Time to get back to basics!
One of the things I like to do on a weekly basis is review my notes when I first started trading the forex market. It serves to reinforce the foundation of my technical analysis, as well as ground me in the very basics of currency trading, no different than bridge builder anchoring their support structures in bedrock!
There is nothing stronger in technical analysis than support and resistance!
FX Traders have at their disposal a number of different technical indicators, but at the end of the day chart support and resistance it the biggest tell-tale sign of what price action truly means.
In Trading 101 we were all taught the virtues of plotting support and resistance. No matter what strategy I am evaluating (swing, intraday) my first actions is to plot support and resistance in the applicable time frames. I use Fibonacci lines confirm my analysis.
Another anchor point I use is trendlines.
Here are some general guidelines you may want to follow. First, look at the general trend of the market. The trend is your friend. For instance if the trend is down this means you have more down days than up -- and usually more pronounced movement to the downside on those down days. Same observations can be made for an uptrend.
I know traders that won’t even trade if the general and daily trends are not in synch.
Once these support and resistance lines are broken then price tend to move rapidly to the next area of support/resistance and the previous break becomes the new floor/ceiling.
Bottom line is to continually build your technical acumen by staying firmly planted in the basic principals of technical analysis.
You can find more FX education and course infromation of FX Trade Central!!
Happy Trading!
Side Notes:
- In addition to trading (always #1) I about working on a Lens. What is a Lens? Stay tuned for my next posting an I will explain.
0 comments:
Post a Comment