S — Keep it simple stupid! This is a well known acronym spanning across many industries. In our last lesson: You will often see my Forex charts with only one or two horizontal lines on them.
Always keep your analysis clear and concise for your own benefit. Ask a fellow trader to check out your charts and get their opinion. A daily trading routine can:. We all know how addictive Forex trading can be, and how easily it is to over-commit yourself to the charts.
Staring at price charts for long periods of time is not healthy and it can cause you to do really silly things. If your trading system requires you to sit in front of the chart endlessly, burn it and move on.
The New York close occurs in the morning, and the London open is in the late afternoon. So, the first thing I do is get up, do my morning things and get ready to check the markets at the New York close for any end of day signals. Then I have all day to do any other tasks I set out for myself, until it is time for the London open in the afternoon. Below is an example of the Asia failed breakout in formation, and generally what I am looking out towards the end of the Asia session…. The screen shot above was taken just around London open.
Keeping it real simple! The market did just that, and this is a common strategy I use everyday in the markets and one you can learn more about in the War Room.
See the difference here? Set your trades up, walk away, go back to your life and let your trades unfold in a natural way.
Develop a routine that will work for you and stick to it. As humans we are naturally innovative and are always looking to improve on what we build. The counter-intuitive nature of the market conflicts with the way we are programmed to function in our day-to-day lives. With Forex trading, simplicity can be the ultimate level of sophistication and provide much better results than a system which has been extended to use more data and variables.
A typical situation you will run into when dealing with multiple indicators is:. Candlesticks for example, give you 4 points of important data — the high, low, open and close price. The chart above illustrates a candlestick sell signal called the Rejection Candle Reversal pattern. The closing price for the day was also lower than the opening price, which is another bearish clue. You need to be clear with yourself about what you want your strategy to do for you.
Do you want your strategy to confuse the hell out of you, or provide you a clear and concise way of reading the markets and the means of making a trading decision without all the stress. I hear this first hand every day! The price action protocol course is something I am very proud of. If you take anything away from this article, I hope that it is this: If you only were allowed to market one level on your chart, where would you place it?
Keep to this rule to help de-clutter your screen. Checkpoint There is no need to sit and stare at ticking candlesticks all day. Develop a routine around your daily life so you can allocate some time to check the market at key times.
Two key times I recommend if possible in your time zone is to check the London open and the New York close. Checkpoint Newbie traders are notorious for diving head first into a load of indicators. Indicators unfortunately only work under very specific circumstances, and traders will often stack them to try filter out the bad signals one indicator may generate.
Hi Dale, as ever a good article and well presented. Can't be said enough. If you want to enjoy trading reduce your screen time! Very well explained articles and believe is easy to use and harmonized with K. It helps reduces trader chances of making wrong and hasty entry decision.
Have seen similar in the past but your explanations are so much clearer. Hoping to join the War Room crowd soon and start some serious trading. There are so many indicators out there that compound confusion in a trader's mind.
Very well presented article by Dale, as always. Thank you Dale yet again another good article that will help beginners to get into grips with forex. I enjoy reading what you write about trading, you make it look so simple, keep up the good work: I always believed that you need to take away your emotions out from the game as well not spend too much time in front of charts.
Wow this is some powerful stuff I've been butchered and slaughtered by the market over and over again but after reading your articles i can now analyse and read the charts in a simplest way ever, i feel now that I am on my way to become a successful forex trader.More...