WHY IS LOWEST?

Most new traders have the same problem that they will more or less experience a period of flooding with indicators, trading systems, tools, and trading methods.

First, you will learn about how to use MT4, then to chart candlestick and related patterns, basic indicators like Bollinger Bands, Stochastic, RSI, MACD, Moving Average. Going a little further, you will discover many other useful indicators such as Parabolic Sar, RVI, Pivot Point, Zig Zag, Momentum, ...

After approaching the indicators, you will discover that there are very good trading methods such as Ichimoku, Price Action, Elliott wave, inter-market analysis ... Then skills such as multi-timeframe analysis, the correlation between currencies, fundamentals, ...

You are overwhelmed by all of that and lacking a so-called logical and efficient link of tools. The reason is that you are still going to find out about those things.

The inevitable result is that new traders often use a variety of indicators and methods in their chart:


The picture represents a thousand words

And of course, certainly, no one has been successful with a chart of many indicators like this.

So what's the solution? A good system requires simplicity and ease of use but must provide sufficient information, not redundancy and lack of lack. Less is better, but there must be a minimum number of tools, enough for you to analyze, and especially each tool will have a different role, supporting you in the final decision.

SO HOW MUCH INDICATOR IS ENOUGH MEDICINE?

In this article, give more advice to beginners than traders who have traded for a long time.

New traders should not abandon the indicator, still have to use tools to support themselves. Here are 4 groups of indicators SHOULD HAVE in a reasonable and effective trading system.

1. BROWSER LINE AND Patterns


In the chart, the horizontal lines are extremely necessary. You use it to draw resistance, support, trendline, price channel. Fibonacci tools are also counted in this group.

2. TREND INDICATOR TOOL


These tools include Moving Average (MA), MACD, ADX, Bolinger Bands. These are engineered indicators to help you identify a good trend.

All traders need to determine the trend of the price before considering a BUY or SELL. Therefore, this tool is especially necessary.

3. QUANTITY / BUYING - OVER-SELL ALARM INDICATOR

Stochastic and RSI are two good candidates. In addition, you can use Momentum, ROC, ... to measure the price force as well as the overbought state.

This group of tools helps traders to identify the strength - weakness of the trend and the possibility of a reversal when the price falls into the overbought zone - oversold.

4. PRICE MOVEMENT INDICATOR


With this group, two indicators are too familiar to us, ATR and Bollinger Bands. They are designed to help you with current market volatility.

The market is active or gloomy. If this indicator shows that the market is buoyant then it is time to take money down to make a profit.

When the market is gloomy, traders should sit outside and wait for opportunities. ATRs and BBs can save traders time looking for opportunities in the gloomy markets.

Moreover, this group of tools is also a great weapon for traders to set up an effective and scientific stop loss and take profit strategy. There are many ways to place stop losses, but here are two tools to help traders place stop losses.

In short, a trading system requires at least 4 basic tools:
  1. BROWSER LINE AND Patterns
  2. TREND INDICATOR TOOL
  3. QUANTITY / BUYING - OVER-SELL ALARM INDICATOR
  4. PRICE MOVEMENT INDICATOR
When you have a certain amount of experience. Then gradually phasing out these tools is essential until there is only a blank chart or adding tools that are more suitable for you.

For now, for a new trader, you should use all 4 tools because it provides you with all the information needed to make a decision.

Here is the chart trade daily: