How to use mastercharts ~ forex trading financial news
I will use the GBPUSD to explain the usage of the charts. You will have observed that GBPUSD is my favourable pair followed by GBPJPY. GBPUSD is more rational, predictable and logical while GBPJPY on the hand is perhaps one of the most irrational and volatile currency pair in the world. If you read some of my previous posts you will have a better insight into the character of some of these pairs.
How to use the Mastercharts
Trading requires careful preparation and insightful analysis. This could be overwhelming and confusing to majority of traders. The truth of the matter is that most traders are incapable of undertaking the complex technical analysis required for informed decisions. The fundamental analysis is a different challenge entirely. I read somewhere that you need 100,000 hours of study to fully understand forex trading. Let me tell you the truth, this statement though slightly exaggerated might not be very far from the truth. However, as a result of my researches over the last few years, I have narrowed down this complex endeavour into some simple easy to understand strategy. The secrets of forex price action are in the higher timeframes. The first step in this process is to prepare the chart for any currency pair you wish to trade to be trader-friendly. How do you make your charts trader-friendly?
How to create a user-friendly chart
If you read my post on how trading could be colourful you will have a clear insight on how to achieve this. As a recap, here are the steps to make your charts user-friendly:
a) Open a new chart for the currency you wish to trade (GBPUSD in this example)
b) Go to the weekly timeframe and draw horizontal lines at the level indicated in my mastercharts. The major levels for GBPUSD are:
a. 1.73000
b. 1.63000
c. 1.53000
d. 1.43000
e. 1.33000
f. 1.23000
c) Insert Relative Strength index (RSI) for 14 days period.
d) Go to the daily timeframe and identify the historical high and low points on the RSI
e) Draw horizontal lines on the daily RSI depicting the historical high and low points.
f) Go to the weekly time frame and click on insert shapes and draw rectangular shape between the highest horizontal line on the RSI and 70 point level. Do the same thing for the lowest point and the 30 point level.
g) Select the rectangular shape above 70 point level and change the colour to yellow. You can select by double clicking on the shape first, then right click and pick rectangular properties and pick the colour from style.
h) Select the rectangular shapes below 30 point level and change the colour to red.
If you follow the above steps, your chart will look like the chart for my example. Your chart is now trader-friendly and you are ready to roll.
More info for How to use mastercharts ~ forex trading financial news:
0 komentar:
Posting Komentar