Hey there guys, so recently ive been getting majority of my friends saying they have read this book called ‘Naked Forex’ i have read some pages of it, and one thing that i found out it totally contradicts babypips in regards to this whole concept of indicators waste of time etc. so have any of you guys read this book or similar and think that type of trading is risk like it states ’ naked trading’ merely of draw specific patterns or would you guys combine both indicators and pattern drawing?
Naked trading also know as price action trading is the preferred method by many traders including myself, I use no indicators except for a simple moving average and horizontal lines to identify support and resistance level, trades are entered on a price action signal at these levels, below is an example of a pin bar reversal signal on the daily chart for EURUSD, I have found no indicator to give a better entry signal then a single candle pin bar
Both methods can yield good results if you understand the underlying principles of their work. I prefer to scalp using only moving average as a technical analysis support, the rest is fundamental analysis and pure price action.
This is a very relevant topic to discuss 
The concept of Naked Trading is beginning to assume the attributes of a new fashion vogue compared with the “old-fashioned” indicators approach and it has become very “in” to “trade without indicators” and to condemn them to the waste bin as only being “history” or “lagging”. In my opinion, this is not an issue of one method vs another but simply yet another different method of achieving the same objective of identifying the likely future direction of price.
Both methods have their own benefits and it is up to each trader to decide which approach works best for them. I do not really accept the argument that Price Action is current and Indicators are lagging. If you look at the excellent example posted by Dennis 3450 you will see a daily bar shown as an example of a pin bar. But this one bar comprises, and requires, an Open, Close, High and Low stretching over a period of the previous 24 hours. If, alternatively, another trader looks at the same 24 hour period with, say, a pair of short-term MA’s on a 1H or 15M chart then he is simply analysing approximately the same time period but with a very differerent approach that is also looking at price movement within that 24 hour. Similarly, using Support and Resistance lines are simply comparing current price with historic price levels that may stretch back even months into the past. So the issue here, surely, is not which method is “right” and which is “wrong” or which is “current” and which is “lagging”, but which best suits the trader’s own approach and preferred visualisation of price action.
For example, I use a very simple combination of a couple of indicators and go “blind” when I look at some other traders’ charts that are smothered with a mass of all kinds of oscillators, lines, clouds, and ratio numbers. This to me is the ultimate “analysis paralysis” syndrome and my brain simply seizes up when looking at it - but for others it obviously really tells a story!
But I think the real issue underlying this question is how well a trader [I]actually [/I]understands the underlying principles that create the lines/patterns/formations that he is acting on. For example, does a trader simply recognise a pin bar and blindly, automatically, trade off it or does he look at it in the context of recent bars/trends/volumes/market times/data releases etc and analyse does this represent early buying running to heavy selling later in the session that pushes the price back to beyond the opening level? Does this selling more likely predict new positions or just proft-taking ahead of an important data release - and so on.
Often, it seems that indicator lines take on a life of their own and traders talk of a line “stopping the price” here or there. Of course, price is totally blind to technical lines (except to a certain extent through the “self-fulfilling” reaction to levels widely recognised throughout the trader community) and will go wherever the prevailing selling/buying pressures and volumes take it regardless of anyone’s “lines”.
If one concentrates on intelligently understanding what their chart lines, patterns, levels etc are really suggesting and combine that with what they are actually seeing in actual price movement and volumes then they are likely to succeed whatever method of analysis they are using.
At least that is how I see it, others will no doubt see things entirely differently! - but that is precisely why this is such a good and important topic to discuss 
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i’m still learning, but i don’t pay attention too much to indicators. however, always have a moving average on your chart.experience it, get acquainted with it…the great thing about a m.a. is that it can quantify how fast/slow something is trending, regardless of e.g. how big the volatility and candle sizes are on the screen. for example, i know anything within 60sma isn’t too wavy to trend trade (at least i like these less wavier trends). i think ideal trends don’t have very big pullbacks (aren’t to wavy ). and something within e.g. 30 ema is even better. so stick this indicator on. and learn/see how if you change the moving average period on e.g. 4h frame (make it bigger for instance), and then change to higher timeframe (daily), you can get similar m.a. line drawn by reducing the period.
Use the one with which you are comfortable with. I have found that indicators only mess up my trading decisions (often giving conflicting signals) so I only keep 2 EMAs and 1 SMA. The rest is just support/resistance zones (drawn manually) and watching the candlestick patterns on multiple time frames.
Nekritin & Peters? Yes, I’ve read it and widely recommended it to many people, in many threads here.
Out of a huge number of trading books I’ve read, over the last decade, it’s certainly in my “top ten”.
I think that for the average aspiring trader, its approach is far more likely to be helpful and instructive than most other books they’re likely to read, and [I]overwhelmingly[/I] more likely to be helpful and instructive than almost all the “information” they’re likely to find online. 
Naked trading is just a buzz word. Supposedly you’re more intelligent if you trade ‘naked’ - you’re superior to those ‘fools’ who are slaves to their indicators. I think trading is much more nuanced, not just black (indicators) and white (naked).
Great post,
Manxx!!!
This choice of method is very individual and just like looking in your own wardrobe:
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Some spend a fortune on only wearing the latest fashions, which only last for a season at most and are discarded instantly as something new appears
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some can only manage the most basic of items and gratefully take any offerings from others that might help
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Some dress to stand out from the crowd, make a statement, protest, walk their own path, even creating their own clothes
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Some dress to blend in with crowd and be part of the majority and find security in following their lead
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some dress strictly according to a code or rules in order to belong to a gang or a profession and in order to be able to follow the activities of that particular community
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some only wear the same old favourite clothes that have become like a second skin and they are never going to change them because they are so familiar, comfortable and actually work for them
But whatever the clothes we choose to wear, they ultimately have to fulfil some basic needs and protect us from the environment and help keep us alive and warm - but if we ever try living in a community without ever wearing any at all (unless no one else does, either) then we are soon going to find ourselves permanently excluded from the local supermarket…
Another excellent post, Manxx!!!
I believe both can work, and what you choose to work with is a matter of preference.
Still, at the end of the day, if you dont understand price direction, distribution, accumulation, and manipulation, your going to fail regardless of which ever approach you choose.
Yes you are right an that is why i prefer to first of all understand the Price action so that my trades are profitable in the end.
Actually just the opposite is true, We who trade naked ( I prefer to call it price action) do so because we admit that we are not intelligent enough to quickly understand all the information that multiple indicators are telling us at any one time. The whole reason for not using these indicators is to stay true to the KISS method of trading “Keep it Simple Stupid”
In any case it all comes down to TREND, with or without indicators we are looking for clues of a trend change, for us price action traders a candle stick reversal at support or resistance give us a good entry with a positive risk vs reward ratio. And as I stated in post #2 of this thread, I will match a simple candle stick pin bar reversal against any fancy indicators any day
You’re only more intelligent if you make money trading forex.
The “The trading naked” is nothing new. You can read about it in “Reminiscences of a Stock Operator”.
There is more than one way to use indicators:
- Generate buy/sell signals.
- Filter trades.
- Confirm trend.
- Use as market sentiments.
If you believe that all indicators don’t work than just trade against them.
Wait for some well known indicator such as MACD, RSI or stochastics to give solid buy signal. Wait for you favorite sell signal and sell the rally.
The main advantage of mechanical systems based on indicators is that you can back test them.
Trade during the day and backtest at night.
Cloud computing and machine learning make it even easier.
The main disadvantage of naked trading is that if you look for a long time at the price chart you can see anything.
Your brain will find some pattern.
There cant be a disadvantage in Naked Trading,
unless you dump your coffee on your chest,.:17:
For the first time in my Forex career, I Always know where the price is going, how far it will go, and when it turns, and I dont use 1 single indicator but the adjustable rectangle box, :27:
i like the most on naked trading when good female traders do it