How to master the art of chart pattern trading
There are many methods of trading the financial instrument in the world. If you are relatively new in forex trading then you might be using indicator based trading strategy. But if you trade the financial instrument with indicator based trading strategy than chances are very high that you won’t understand the real price movement of the market. If you look at the professional traders than you will see that most of them trade the raw price in the market and different chart pattern. Chart pattern trading is extremely profitable and reliable in the forex market since it allows the traders to catch the large movement of the market. There are many different ways of trading the chart pattern in the financial world. In this article, we will discuss how to trade the highly reliable chart pattern like the pro traders.
Explore your trading platform: Most of the novice traders in the financial world doesn’t even know that their trading platform provides unique sets of tools to do the perfect technical analysis in the market.
Figure: Professional platform offered by reputed brokers
So as a trader you should learn about the different trading tools and indicators in your platform since it will help you to analyze the market in a much more better way. All the professional traders in the financial sectors put a great deal of emphasis in exploring the trading environment since its one of the key method of enhancing your technical skills in the market. As a trader, you should know about the different functionality and different types of charts viewing options since it will allow finding the best possible chart pattern in the market.
Reliable chart pattern: There three highly reliable chart pattern in the forex market which the professional trader’s trade. The first chart pattern is the head and shoulder chart pattern and its bearish trend reversal signal in the market. The best way to spot this chart pattern is to use the 4 hour and daily time frame in the market. The second most reliable chart pattern in the triangle chart pattern and the best way to spot this chart pattern is by using the daily time frame in the market. The third type of chart pattern is the doula bottom and double top chart pattern and they are usually found at the top and bottom of the trend. But when you trade the different chart patterns in the market make sure that you are using the higher time frame in your trading platform.
Use price action confirmation: Price action trading strategy is considered to be the most profitable trading strategy in the forex market. The professional traders trade the highly reliable candlestick pattern at the key support and support and resistance level by using this system. But this system can also be used in chart pattern trading. Once you find a possible chart pattern in the market tries to find a reliable candlestick pattern favoring your trade direction. Let’s make it clearer. Think that you have spotted a head and shoulder chart pattern in the forex market. So as a professional trader you should wait patiently for the breakout of the neckline. So once the neckline is breached in the market then look for bearish price action confirmation signal in the market to execute your orders in the market. There is two method of trading the chart pattern the first one is the aggressive method and the second one is a conservative method. So if you are relatively new in chart pattern trading then you should follow the conservative method of chart pattern trading which includes the used price action confirmation signal.
Summary: Trading the chart pattern is one of the most profitable ways of catching the large moves in the market. In this article, we have told you the most reliable chart pattern in the forex market. If you truly want to master the art of chart pattern trading than try to spot the chart pattern in the higher time frame and use the price action confirmation signal to trade this pattern. But before you start trading the chart pattern make sure that you reduce the risk exposure in the market since you will be trading against the long-term prevailing trend in the market