It is crucial for a trader is to understand the price movement. Of course, from this understanding, then will conclude on what position to take, how much TP and how SL. For Fundamentalist traders, understand price movements can be done by monitoring news and initial predictions about the market reaction to the news.
As for traders technicalist, understanding price action course refers more to the historical data. Course in accordance with the basic belief that everything happens based on past events and that history always repeats itself, as well as in price movements. For a technicalist, in order to understand these price movements, it is necessary to know the components of the price movement as follows:
Trend - a tendency to move in one direction
Volatility - the amount of periodic fluctuations
Momentum - the rate of acceleration and deceleration
Cycle - a tendency to move in a certain cyclical pattern repeated tendency
Market Strength - the number of transactions to support these movements
Support and Resistance - a tendency to go up or down to a certain level and then vice versa, repeatedly
An understanding of these things is a must to be able to take the right decisions in her trading. No need to worry about where to obtain the data and how to process the data we need. That said, we are really lucky to exist in an era in which all sorts of information from many sources can be processed and presented in real-time so that we can trade with ease plus fun.
We can use the trading platform and software support for the problem of data and processing this data. You can just click to display the indicator you want, which basically provides information about the components of price movements over. No need to worry about how to make these indicators (except like you who really want to make their own custom indicator).
The most important thing is how you understand what is shown by the indicator. There are many indicators that you can use to read the above components. For example, to read the trends, you can use a parabolic SAR, or it could be a family moving average. To voltilitas and momentum, you can use the MACD, RSI and the like. For cycle-resistant and support you can use Fibonacci or pivot. And to the strength of the market, you can see directly in the candlestick.
So, your task is simply to choose and understand aka "communicate" with the indicator, then take the right decision based on your understanding of the data and these indicators. By using a strong base in decision-making, whatever the results we obtained, we can take the benefits. Well, hopefully if profit. Even if the loss, from there we can take that lesson the next time do not happen again making the same mistake.
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