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Forex indicators - benefit or harm?
Written by: PaxForex analytics dept - Monday, 02 January 2017 0 comments
The excess technical indicators, if forex trader overuses them, often does more harm than good.
At best, it just creates a lot of unnecessary noise during trading. Each signal of a technical indicator is perceived as a signal to enter the market, but in practice it is not always so.
Exploring the "pure" price chart, the trader keeps in mind only its direction. The appearance on the trading graph too much of additional information leads to unnecessary hesitation and doubt of a trader.
Ultimately, the information overload causes trance state, when attention is scattered, and the man partly loses conscious control over the market situation.
In addition, overlay of indicators gives a lot of signals for opening transactions, more than half of which in the end would be false and will lead to the losses.
Therefore, setting up a trading platform, it is desirable to remove from the screen all the
unnecessary information stuff, leaving only the price chart with a preferable timeframe.
It is also recommended to set up a working screen before the start of trading in such a way that it reflected only the most relevant information. And even that information should be used very consciously and critically.
Nowadays, the idea that the most valuable thing in the world is the information is almost everywhere. However, it is that same thing - information – that can cause irreparable harm. In the case of Forex market trading is expressed as big losses.
That abundance of technical indicators, which are now available to the trader, is not always beneficial. Those who can not imagine trading in the forex market without these technical things, should remember that effective trading with indicators is possible only on the timeframes over 1 hour. For shorter periods of time, such a trading strategy is very rarely profitable.