Forex Charts Analysis Wise Traders Do

Forex charts will always be confusing to traders. Because there is no universal truth about these markets. It’s not always currency pair A leading B, but rather B can also lead A. The fact that one currency pair, such as EURUSD has the biggest trading volume, doesn’t make it a leading pair at all times. Low volume correlated pairs can also lead, just as easily. And the signal on EURUSD turns out to be a false one, is not as if EURUSD doesn’t give off false signals. Forex charts therefore will always create confusion to traders who think and act through an absolute mindset. Various good forex trading strategies can still be developed and implemented. All the trader has to do is identify the uniqueness of each currency pair, and what makes that pair unique each day. Wise CFD traders are very selective traders, and have learned to do just that. This is also why generic trading systems fail, because their approach to trading is quite naive and crude in nature. Forex robots also fail, because of this fact, because they cannot think like humans do. So as to identify what’s unique in any given trading session. Foreign exchange currency trading online for beginners can be a great learning experience when one learns to think wisely. Moreover, trading systems that treat each trading day as unique, help the trader overcome routine life. And overcoming routine makes trading much more personal and interesting. The charts will always be confusing to many traders. Because their learning lacks depth and the capacity to deal with the inner workings of the forex market. Only wise traders, traders who take initiative and question established opinion make progress. We all have seen the forex market do all kinds of crazy things. Things that defy belief, where a currency pair defied the best indicators and the unthinkable move happened. And not only it happened, but the pair in question moved by 200 or 400 pips in the unthinkable direction.

Which Indicators to Suspect and Doubt Most on Forex Charts

Some indicators are really deceptive on the forex charts. Especially indicators of momentum and patterns defining thin levels of support and resistance. Momentum can be extremely deceptive, and this is because sometimes it acts in a leading way and it works. But few days later it starts to lag the market, and the big losing trade comes along. Thin pivots of support and resistance are also deceptive. Wise CFD traders treat these levels as levels of test, and not as levels of conclusive support and resistance. The market can simply test these levels, breach them, and still go in either direction. Traders eager to get in the market at that time, end up losing every time the test fails. And there is no way of knowing the outcome of the test there and then, because momentum itself is deceptive. So one way of getting around this problem. Is to use pivots that are defined over wider price zones. Giving momentum more margin to reveal itself. Momentum can easily fool you over a margin of 10 pips, but not so easily over a margin of 200 pips, and over many hours. Wise CFD day traders read day trading forex live review reports and learn about indicators that don’t work. As well as indicators that only work over wider margins of safety, as mentioned above.