Forex Charts - Basic Profit Tips For Beginners

[Eleanor Ritter]

Here we will look at forex charts and basics for beginners and novice
traders on what they have to do enjoy currency trading success.
Charting is not a science, it's an art but if you learn the basics
below, you will soon be using forex technical analysis confidently and
enjoy forex success.
Here are your forex chart basics for success.
1. Pick a time frame
Forget day trading it simply doesn't work as the time period is to
short. You can either follow long term trends and forex swing trade.
The former has the biggest profit potential but requires plenty of
patience and discipline and the latter sees trades come more often and
requires less discipline.
2. Simple = Best
Keep your forex charting system simple - simple systems work better
than complicated ones.
Why?
Because they are more robust and don't have as many elements to break.
3. Don't Predict
Many traders think they need to predict with their forex charts but
prediction is doomed to failure - Why?
Because - you are hoping and guessing and this is not a good way to
make money in any market - especially forex trading.
You need to confirm all your moves with price action. We will come
onto this in a moment but let's first look at the basis of all good
forex chartists systems.
4. Support and Resistance
If you don't know what it is look it up, it's an essential part of
anyone's forex education.
All good forex trading systems understand it and use it.
You need to trade valid support and resistance. This means as many
tests as possible ( but no less than 2) in as many different time
frames and the wider apart the better. If it's valid, you can trade
into to it and look for it to hold or break and catch new trends.
5. Confirm Don't Predict
For example - if you want to buy into support don't just jump in hope
support holds wait for a turn in price momentum and use leading
indicators such as ADX, RSI and the stochastic ( there discussed in
our other articles ) and trade the reality of price change.
Don't however think of just trading levels holding look to trade:
6. Buy Or Sell Breakouts
It's a fact that most big trends start from new market highs NOT
market lows.
While you don't buy low and sell high you do something that's very
profitable you - buy high and sell higher. All the best forex
chartists do this and you must to.
7. Be Objective Not Subjective
Ignore indicators that mean you have to make to many subjective
judgements, go for indicators combined that give you a clear trading
signal - NOT indicators like cycles Elliot Wave etc where your
emotions could get involved.
The above are the bare basics you need to know when using forex charts
and they should form the basis of your forex trading system.
Keep in mind keep it simple - simple systems work best are easy to
understand and easy to apply and if you use objective indicators, you
will keep your emotions out which are the enemy for most traders.
Forex charts can make you a lot of money, so learn how to use them the
right way and currency trading success could be yours.