I agree that price direction on weekly charts seems to be very reliable compared to shorter frames, but I still think it’s probably fractal and all the same, but the stress and ultra-fast moving nature of the very short time-frames is what makes the shorter frames more difficult / stressful. This is all totally non-evidence based however! I’d be interested to know what research has been done in this area.
For example, if you look at a weekly chart over 5 years, is it really any less random than a 5 minute chart over the last 3 hours?
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Sorry, I meant monthly chart over 5 years
Good morning. Go back and dig into fundamental analysis more to get a better answer to your original question. You’ll understand better what countries are doing and how it affects the market. In other words don’t just focus on technical analysis. I’m sure this will help you
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I completely feel so lost in reading the charts. Its like I have not been reading and practicing on demo
Yeah. You need to take classes to learn all the chart patterns, such as wedges, pennants, harmonics, classes that will make you LOSE.
Every retail trader and their dog are reciting chart patterns in their sleep, but the thing is, if traded mechanically, most chart patterns fail. It is well known.
To succeed you need to learn to read the ebb n flow of the market. Momentum and Trend is where it is at. Ignore the chart patterns and learn to trade levels, preferably in harmony with the prevailing trend, and in agreement with market momentum…just let the chart patterns take care of themselves, as incidental side shows, which is all they are.
…and if that all sounds a bit hard and complicated, that’s because it is.
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Hey John,
In that case, how many confirmations would you say would be a “good enough” amount?
I hear you and totally understand how you feel, a few years ago I felt the same as I didn’t know the different meaning to certain terms most of them I was clueless about. My advice to you anyone who is starting out new is focus on the area that you do well in or better at and stay in that area. What i mean by this is for example when i started trading i wanted to almost trade all the currencies which ever i seem to see a potential opportunity in I would trade, I did this bad habit for quite a long time struggling and fighting to be good at any pair. After I while I released what i was doing is wrong as i was constantly losing more than i would win. Then after a while I realized that by sticking to one or 2 or maybe a few more pairs in your case I became more aware and patient and would wait for my setups and patterns to show which have made a huge difference in my trading since i am not trying to focus on plenty pairs I became consistently winner. I have also developed more knowledge and understanding in the pair that i focus on where my predictions on its movement has become way more accurate because i am centered around it. So for me there is only 2 pairs I trade and I don’t tolerate any tempting distractions of other pairs that usually work on me in the past but now I have gained more self control to stop myself. I believe this will help a lot to be a better trader
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If you think about it, the Higher timeframes are where the Big Money, express their views on the market. The low time frames are where the big money feeds on the little money.
Thus a Harmonic pattern, or Asc Triangle break out on a weekly chart, is far more likely to be a ‘sincere’ representation of that market, than the same thing on a 4 hour chart. Most of the text book patterns on the lower timeframes turn out to be traps, and the lower you go, the more treacherous the patterns become. The low time frame trader needs to adjust his approach accordingly.
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Disagree with this 100%.
If the only tool you have is a hammer, then every problem you have will start to look like a nail.
If you go to the markets focusing on just one distinct market configuration, you will start seeing them everywhere, or taking them with no consideration to the prevailing flow and momentum of the market.
This whole focusing on a bottum up patterns approach is the death knell of the retail day trader and will kick off the whole ‘the more I know, the worse I get’ process that many retailers have to go through as a result of all the quack education and trading advice out there.
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Yes, there is a danger of finding a pattern everywhere simply because the trader really really wanted to find it. But surely that danger is magnified 10 times if the trader is looking for 10 patterns.
By referencing Thomas Bulkowski’s site I hope to encourage people to look at his rules for identifying each pattern. His rules are the most refined and precise I have seen. Most commentators will take the view that if it looks a lot like a triangle, price will behave a lot like price behaves when there is a real triangle. Bulkoswki excludes such vagueness and is forensic in his definitions.
I agree, wider perspective set-up trumps an isolated pattern, even if its a text-book example. You should say more about how you gauge the flow and momentum of the market before trading.
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makes no sense
Don’t worry buddy. This happens with every beginner if I am not wrong. Like, it takes time for us to get a grasp of technical analysis. Chart patterns can be confusing at times until you get used to seeing them. Just take your time and it will get a lot easier eventually. Good luck!
Yes, with practice, it will become easier. Learning and practising are the only ways to improve. Continue to learn and share.
Frankly, good entry points are rare! So, I don’t expect tons of good entry points in everyday! And then I don’t see any good entry point I just wait!
I was like that too when I was a beginner. It can take time for anyone to get comfortable with the chart patterns. Just be patient and spend more time on chart reading. Interpreting the patterns is quite subjective to how your strategy works with it. I am sure that you will figure it out eventually.
Honestly, if you are Lost, is because you haven’t found your edge or a strategy.
Once you have It, you Will have no problem. You Will just look at the chart and see if What you want to see is there or not. If It is… you trade… if not you don’t . That’s It.
Stop wasting your time trying to Make sense of this market, and start testing strategies. Define your trading rules.
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Only if I could like each and every comment in this thread, but this one I think deserves my reply:
Thank you for this one. I have been studying trading (paper trading) for the past 8 months and have not seen little to any significant progress. I keep getting lost in the market structure and chart patterns.
But my time will come; I believe that newbies like us need to trust the process of continuous learning and re-learning in order to find this edge and strategy that will fit my eyes for the market.
Thank you averied for this very kindd reminder.
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O please tell the who the scalper is so we can follow.
Good read Thanks
He trades indices live on telegram at the opening sessions of London and NY. He doesn’t charge any of his followers, and is long term profitable. Bear in mind he also suffers losses, as does every trader on the planet.