Staying analysis
20.16
Support and resistance. Triangles, channels and Fibonacci numbers. If you’re new to trading, you may have heard these terms and wondered what is technical analysis, and how can it help me become a better trader?
Think of trading like playing a sport to succeed, you’ll need training, discipline and a plan that will get you to the finish line ahead of your competitors. Analysing the markets is an important part of that plan, and for many traders, technical analysis is the most efficient way to crunch the data. By charting price movements you can learn to identify patterns that may help you gain insight into where prices may be headed next. Technical analysis gives many traders a clear rationale for taking a trade which helps them to stay disciplined and follow their trading plan.
Aim for trading consistency
Successful traders have a trading plan in mind every day. They know when to make their move, and when not to. Above all, traders must strive for consistency and follow their strategy. Technical analysis simply gives traders a set of rules that they can follow. For example, if prices for your favourite instrument have reached a support level a level where, in the past, buyers have come in then your rule may be to buy at that level. By following these types of rules, it will be easier for you to achieve consistency.