The trading system is a set of rules that guide us when to find and when to close positions. These rules or instructions are based on technical analysis and are validated and proven to be correct, based on old data. The trading system allows us to free ourselves from the emotions that invariably accompany the trading processes. When a trader sets out to find a position, doubts and questions always arise that strain him mentally.
Computers and information technology allow traders to predict price trends without much effort. Technical indicators do all the work for traders, freeing them from the need to perform difficult mathematical and statistical calculations. In addition, they save time for traders to analyze the market. We must admit that the technical indicators are not crystal balls; they fail and lead to losses. But if traders focus on highly reliable chart and candle models, apply a few indicators to identify the perfect entry and exit points, they will always be ahead of the game. So, we recommend that you use technical tools in your internal transactions not only because it is convenient but also because it will help you minimize the impact of emotions on the decision-making process.
Japanese candlesticks offer a better visual perspective for predicting future market activities than bars. Intraday charts with clear Japanese candle patterns are invaluable for entry and exit strategies. Below is a comparison between a bar chart and a candlestick chart
Technical analysis – this is a study of market dynamics, most often using graphs to predict future directions. Primary the analysis is considered prices and the change in other factors (volume and open positions), is studied to confirm the correct direction of the price. The graphs reflect the influence of fundamental factors in the market and in the technical analysis takes into account the following tenets:
The forex market is driven by economic factors, that affect the value and strength of the national currency. The economic outlook for a country has the greatest impact on the value of its currency. Knowledge of monitoring factors and metrics will help you keep pace in the competitive and fast-paced forex world.
The exchange rate represents the numerical ratio of one currency to another. The term is widely used in the foreign exchange market “currency pairs”. Depending on the duration of the foreign exchange transactions, there are two types of exchange rates – spot rate and forward rate.
With its daily exchange of conversion operations, FOREX (Foreign Exchange abbr.) is the largest and most liquid market in the world. Commercial and central banks, currency exchanges, investment funds, intermediaries, brokers and individuals exchange more than $5 trillion every day.
