Weapons You Use

Hey there!
I am a beginner trader ( even if I can not call myself like that, cause I’m still in demo ).
I see trading as a possible lifetime marathon, and there is no reason to rush in aggressively, before becoming confident with the tools you are going to use, and the money management decisions you will apply to your trading…
Nevertheless, I have developed an idea of what tools I feel like can really prove themselves as winning ones, even for that 5 times out of 100, that could make the difference between a winning and a losing trader.
For now I feel comfortable with:
Candlesticks patterns
Boilinger bands and
Fibonacci levels.
Before going live I wanna understend well and make myself cosy with
Elliot waves and
Pivot Points .
combining these tools, in my opinion, could work for me.
I may include some momentum oscillators ( I like the idea behind the formula of Stochastic, but unless used in divergences the indicator has proved to show too many false signals ).

And what about you? I would really like to hear your story and what are the tools that work in your trading :slight_smile:
Have a great day fellas!

Trading is not like anything else we learn or do.

Education and the professions we undertake tell us to learn more and more about less and less in order to succeed. But perhaps the best return on time and effort invested by traders is to understand what is the least amount of information on which we can make a trading decision.

1 Like

No… you CAN Call yourself a beginner, that’s what a beginner should do , but most don’t because they are silly.

that’s correct
so… So far you are on the right track
but this is not the whole picture

umm, yeah, but this doesn’t really tell you much
it just sounds cool

yes this is true
but there is a big difference between SAYING THIS AND DOING IT .

Candlestick patterns are greatly overrated, i wouldn’t focus too much on the patterns themselves.

Bollinger bands - ok, if it works for you
Fib - ok if it works for you however you might find that Pivot points are doing what Fibs do anyway

Elliott Waves - this is a concept, now… there are actually indiicators to show elliott waves but CAN YOU TRUST THEM is the question

ok
i use Correlating Pairs
i use MACD on low time frames to pick entries but not on higher time frames
i have Bolligner bands (Actually 2 over each other, 1 at 2 SD and the other at 3SD)
pivot Points
Heiken Ashi (i rely pretty heavily on HA Candles) they prove to be very reliable again and again.

beyond this i have finer details, but important nonetheless
things like Certain colours on certain charts or indicators or backgrounds
the purpose of the specific colours is a few

either the purpose is to relax the eyes… what i mean is…
it’s a fact that certain colours are easier to see than others, and over a long period the harder colours will make the muscles in your eyes sore

the other thing is instant association to something or an event

that’s basically what i do

2 Likes

[quote=“sumaruktrading, post:1, topic:134947”]
before becoming confident with the tools you are going to use, and the money management decisions you will apply to your trading…[/quote]
You will receive much better advice from others here than from me, and I don’t post much here anymore for that reason. But I like what you say here and I would just like to encourage you and say that you show the right attitude and a good understanding of what is required.

You are right to refer to these as “tools”. That is exactly what they are - and are only as good as the expertise of the person applying them to their trade. They are not (as some seem to assume) some kind of Harry Potter wand that somehow mystically tells you what to do and when without you having to take your eye off the golf ball.

Some people prefer to rely mainly on “price action” techniques such as identifying patterns and support/resistance areas, etc. Whilst others prefer the type of indicators that you mention in your post. With these indicators it is worth remembering that they only show you the result of a mathematical calculation and, of course, markets do not always conveniently move in a consistent manner such that any of these types of indicators will always give a consistently satisfactory signal.

There is no reason to assume that you should be either a Price Action or an indicator person. These are all tools of the trade and it is for the trader to select which tools from either/both of these approaches will provide the most suitable combination.

I am sure all of those tools that you mention will work for you some of the time - and none of them all of the time. Also, you will find that if you apply them all to your chart and give each of them equal priority regarding their signals then you will end up in a situation where there is always one or more tools saying one thing and others saying another. It is worth planning your tools so that they are each showing different attributes such as direction and momentum. If you have 2 or more indicators showing the same attribute then it is best if one is the prime indicator and the other is only a confirmation.

There are many issues to think about here:

It is important to decide which type of trading suits your circumstances, capital, interests and psychological make-up. For example if you are interested in just sitting a few hours during each trading session intensively scalping a few pips off multiple signals then many of these tools will be useless. On the other hand, if you are interested in taking longer term positions and also following the dynamics of the currency and its economic developments and the policies of the central banks involved then a different set of tools will apply.

As you also mention, risk and money management issues are at least as important as the direction of the market. It is easily possible to get the direction right on more than 50% of trades but still lose money. And vice versa, one does not need to get more than 50% of trade directions right in order to profit overall.

Personal skills such as patience and discipline are almost clichés on this site - but that is because they are essential components of successful and consistent trading.

I guess your purpose in considering the tools that you mention is mainly to help in identifying entries. But I personally believe that successfully optimising trading depends more on defining your exit conditions than your entries. For example, it is easy to set a reasonable stop that gets you out of a wrong position but a wrongly timed exit may mean you miss out on even hundreds of potential pips from the continuing move, especially if you find it hard to define a re-entry level.

Well, I have already said too much here, so please excuse me and just jump to the next post! :smiley:

2 Likes

To be honest, if you are able to read the trading chart; then you don’t need any additional help from any kind of technical tool; so my suggest is try to read more your trading chart!

Spend some time studying at the free school here. Ive been through it twice.
You will change your mind a hundred times before you settle on how you want to trade.
A couple of points to bear in mind;

  1. It has to be your way if trading. A way that suits you as a person, not my way nor anyone else’s.
  2. Dont be afraid to lose money, indeed embrace it. You will learn more about your trading mentality when you lose than when you win.

Namaste

6 Likes

Very good suggestion; really BabyPips School is one of the best trading course!

3 Likes

tool: brain- only tool you need

4 Likes

Exactly, without brains nothing will help.:sunglasses:[quote=“MrDE, post:8, topic:134947”]
tool: brain- only tool you need
[/quote]

I’ll put my two cents worth in here. I use a white chart with pretty green and red candles. That’s it. I can’t even stand to see moving average lines anymore. That’s just me. I get distracted by all the “stuff.” I trade “naked” price action. I will draw trend lines and horizontals, but when I’m through trading that chart, they’re gone!

Cluttering your chart with 100 indicators may look impressive to someone on the outside, but if you can’t even see where price is anymore, they’ve defeated their intended purpose. By the way, Elliott principles are useful when trading naked. But keep in mind, it is a very complicated system and you have to be dead on when identifying which wave you are on. Most full-timers I know have a solid grasp of EW, but they don’t always use it.

Happy charting

1 Like

I don’t think the OP’s question had anything to do with whether or not one has brains, or can, or should, use them.

It hardly needs mentioning that one needs brains to make profits consistently. The issue is what to apply that brain to…

Stating the obvious is hardly beneficial, in fact almost insulting, to the OP.

1 Like

Thats an interesting idea to keep the colors of charts in a certain way in order to relax your eyes!
I thing I’ll borrow this one from you :wink:

Thanks for this long reply!!! The thing you said about combining direction and momentum indicators is the way to go… you see the same elephant from 2 different sides.

youd be surpriissseeeddd how many think they do, but actually dont use their brains :wink:

Nicely put (but if I said the same when observing how fast my wife is going up the stairs I would be in big trouble! :smiley: ).

But having said that, I do agree with most people here that you will end up using very few of these types of indicators once you get more experience in watching charts. But it is a good thing to go through them and see what works for you, when it works for you and on what time frames it works for you.

Personally, I only ever rely on a few sequenced MA’s in various combinations with small tweaks here and there depending on the timeframe I am using - and only then if it agrees with my overall assessment of the market in general. Sometimes I’ve applied an RSI or MACD as a trial secondary confirmtion but usually found that I “forget” to look at them (especially these off-chart indicators) and dump them!

I think most of us here agree that learning to watch the price action in the charts themselves and applying commonsense to that - and then carefully choosing your trading times and the background sentiment surrounding your pair…and then looking at your technical setup to confirm (or not!) your opinion, is the essence of a well-planned trade (within a clear, precise risk/money management structure).

I think the best advice I have seen here for a long time was from someone focusing only on taking the carefully planned trades. A clear strategy with well-defined parameters will always separate the traders from the punters - which also brings us back to the other problems of patience and discipline.

One other thing to get used to is that losses will occur and indeed should occur. If they don’t then you are not trading optimally. You can only profit by being in the market. It is a bit like wandering in a maze where there will always be wrong turnings. But you recognise them, reverse out quick and try another avenue. And when you find the path that takes you forward then you stick with it as long as it is the right path.

The only losses which are bad are those resulting from maverick trades and/or are outside your management parameters.

Once again, this is only a personal take - the beauty of trading is that we are all on the same side but can still look at things in very different ways…trading is a very personal thing! :smiley:

1 Like

Yes I would have been very surprised before I joined BP, but after a few years here?..no, I really am not surprised at all! In fact I am totally horrified at much of what I read here! :smiley: Horrified at what people do and even more horrified at what they are allowed to do!

In fact one reason I do not post here much is because I really do not want to encourage people to inevitably lose all their limited funds…but every now and again there appears someone here that does seem to have a head on their shoulders. and I see that in @sumaruktrading :slight_smile:

What most people have said here is correct. But I wonder why non has mentioned about money management. To me personally, money management is the number one tool to my successful trading. Poor money management can turn a winning system into a losing one. That’s how powerful the tool of “money management” is.

1 Like

sweet sweet music to the ears of bookies, dealers & brokers & the primary reason they adore & cherish trading forums - the more complicated punters make their lives, the sweeter the music.

forum junkies, marketing guru’s, seminar hucksters & shills all preach the same nonsense gospel, playing right into the hands of the dealing firms which inevitably leads to some punters dripping fast, others more slowly, but most of them eventually dripping empty.

t’is a fer fer funny old game ger ger ger granville.

2 Likes

good one. me likey. continue :joy:

edit: somebody complained this post is offtopic. so im adding valuable information regarding the question of the OP

what tools to use?:-
-you should definately use a charting tool and a broker for trading. otherwise it will be hard.
you as well should utilise monday till friday as i figured out that brokers dont like to do anything at weekends- hence a calendar will be extremely usefull. you as well need a clock to know whem your broker opens and closes. oh i nearly forgot: a computer can prove itself as valuable for this “life journey”.

hope i helped.

@sumaruktrading
Sure… Feel Free

in short, Colours are Frequency
now, that means… in order for you to SEE a colour , here is what has to happen

the colour emits it’s frequency and the light hits your retina
this frequency passes into your eye and your optic nerve
the muscles in your eye VIBRATE at the lights frequency ,

Now. the speed at which your muscles vibrate or move at will tell the brain what colour it is
the brain then says… Oh … so this is blue

now focus on the vibration
you see
the higher the frequency , the faster your muscles need to vibrate or move
now
what do you think is easier… to move faster or slower
SLOWER… right

so hence, use colours that are off a lower frequency and your eyes will be relaxed
simple as that