Once you enter the Forextrading world you will immediately notice the need of usingtechnical analysis in order to find trends when looking at theforex charts and also the importance of being aware of when theyfirst develop so you can ride the trend until it ends. Theforeign exchange market is a very strong trending market, lotsof ups and downs in short periods of time, and it's, therefore,a place where technical analysis can be very effective.
But you should always remember that the indicators are onlygiving you a high probability behavior the markets may show whenyou are trading, but will never tell you the behavior of thecurrency prices with total certainty.
If you want to become a profitable forex trader you will need touse as many technical indicators as you can, or create apersonalized trading strategy based on a combination of theseindicators, to recognize with the best accuracy possible thetrend. In other words, a professional forex trader will try toidentify the major trend, the intermediate trend, and theshort-term trend and then construct his trades in that directionbased on how long their rules allow him to hold a position.
The forex markets are always changing, that's why you shouldalways have an open criterion when using your technicalindicators. Markets will be changing and different combinationsof indicators may be required with time in order to have themost accurate, highest probability, prediction of futurecurrency price behaviors.
If the action of the market shows your judgment to be correct,then you must consider staying with the market' and look for themaximum profit on each trade, according to your risk-to-reward /equity management rules. If you happen to be in a bad day andthe market goes against you, the smart trader will take profitsand get out of that trade. In a narrow market, when prices arenot going anywhere, but move within a narrow range, there is nosense in trying to anticipate when the next big movement isgoing to be.
So, you must always be alert and open to use as many and asdifferent indicators in order to stay tuned with the market andbecome a profitable trader at the end of the day.
About the author:Adrian Pablo is a freelance writer with articles published in anumber of places. Get a free report on Fibonacci Trading andlearn more about the world of trading , visit the website:
=> http://www.1-forex.com
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