The 8 Technical Analysis Hacks Every Trader Should Know
As a trader of the financial markets, you have one goal...
To make money!
But one can never get complacent.
You always need to be on the lookout for ways to improve your strategy and the way you approach trading.
And today, this is exactly what I am going to show you.
Eight ways to boost your profits and trading success…
8 Idea’s No Trader Should Be Without
Technical Analysis Hack #1: Always Keep Your Emotional Distance
It’s probably no surprise to you to learn that your emotions can play complete havoc with your trading activities, but it’s something you must remember every time you trade.
Letting your heart rule is a recipe for disaster and will lead to losses.
This is why it is crucial that you have a strategy and follow it religiously.
A strategy gives you a plan to follow, allowing you to block out any interference from your emotions.
Try to view your trading activities as a business. This will help you stick to this.
Of course, you may need to take the time every now and then to tweak your strategy if necessary.
And this is why keeping a trading journal is so important. You can read more about doing this here.
Technical Analysis Hack #2: Don’t Get Stuck In A Rut
Once you get your strategy working for you, it’s easy to stick with it.
But don’t discount what other technical indicators could add to your strategy.
This is especially the case the longer you’ve been trading. You should always be learning and experimenting with new techniques.
You may find that certain indicators work best with specific securities.
When you try out new technical indicators, instead of putting your cash at risk, paper trade first.
If you see good results, you can put the trade on properly.
This will help you add to your trading arsenal and improve your future success.
Technical Analysis Hack #3: Never Ignore The Trend
Whilst you may think that the trend is something newbie traders should be more concerned about, it applies to all.
Taking heed of what the trend is showing you is vital to bagging winners.
It should be one of the first things you do when assessing a new trade.
And this means NEVER EVER trading against the trend.
This applies regardless of if you trade intraday or over a longer timeframe.
Technical Analysis Hack #4: Know What You Want From The Outset
It’s easy to get into the bad habit of making trades fit your criteria, but this certainly won’t yield results.
You need to avoid looking for trades and making trades fit. Instead only go for trades that tick all the boxes related to your strategy.
If, on the other hand, you make a trade fit, the chances are you’re going to lose money.
Don’t risk it and gamble with your cash.
Be strict with yourself. If you find yourself scanning the market making excuses for why a particular trade could work, it’s time to turn off your computer and walk away.
Your patience will pay off when you find your next perfect trade.
Technical Analysis Hack #5: Look At Different Timeframes
It can be easy to get into the habit of looking at potential trades over the same timeframes.
But if you consistently do this, you may actually miss some vital information, such as a trend that is about to change.
So instead of concentrating on short timeframes, zoom out and look at the bigger picture.
The bigger picture may reveal something that will make you think twice before entering a trade.
Knowledge and information is key to making profitable decisions.
Technical Analysis Hack #6: Don’t Forget The Fundamentals
Obviously as a technical analyst, your goal is to use technical indicators to find and execute trades.
But don’t forget the importance that fundamentals play.
For example, if you trade the forex market, you need to know when there are announcements of economic events, such as the release of inflation rates and economic growth rates.
These events can make big changes to currency rates.
And if you trade stocks, keep abreast of when results are due out. An earnings shock could have a big impact on the price of a share.
Knowledge is key.
Whilst you shouldn’t be spending hours checking this information, a quick Google search before putting a trade on is well worth the time.
Technical Analysis Hack #7: Keep It Simple
With hundreds of technical analysis indicators out there, many traders find their strategy becoming increasingly complex over time.
If you think you’re falling into this trap, stop!
Keeping your strategy simple is so important.
It will save you time when finding trades. And it will make it much easier for you to analyse what’s going on.
Yes, you can’t rely on just one indicator to act on, but if you’ve got a notebook full of them, it’s time to cut it down.
The important thing is to use indicators that show you a specific thing and then another indicator or two to confirm this.
Technical Analysis Hack #8: Use Candlesticks
If you’re not doing so already, make sure you use candlesticks in your charts.
Firstly, they are very simple to understand and give you a lot of information. For instance, the high, low, open and close prices.
And secondly, you can glean a lot of information from their formation.
With a bit of practice, you’ll be able to use them to spot when the market is hinting at turning. This helps you to improve your timing for entering and exiting trades.
Making The Most of Your Trading Adventures
By keeping in mind the technical analysis hacks that we’ve looked at above, you can improve your rate of success.
Along with patience and discipline, you’re setting yourself up for a successful and profitable future ahead.
And don’t forget, all traders go through rough patches every now and then.
If this happens to you, don’t give up and don’t lose sight of why you are trading in the first place.
Stick to your strategy and the trading hacks above!
Until then, here’s to profitable trading.
The Money Lab