Two Important Points In Analyzing Currency Movements

Most of the traders do not know what exactly they are looking for when analyzing forex chart. Maybe they know how to use indicators but they do not know exactly what the indicators that should be used.

You need to know that there are actually many ways to analyze candlestick charts and all the ways it is true as long as it can make a profit and can be accounted for. so, I want to share here is a basic how do I analyze a price movement with candlestick chart. This is not a rigid manner, that you should obey. but it is merely a point of view from me that you have to see for yourself the truth.

Ok basically, in analyzing the price movement of the currency markets, there are two points that need to be understood by all analysts. This can also be applied to analyze all the currency market. Either with a candlestick or derivatives (indicator):


  • The first is identify the direction of movement of the currency, usually we call it a trend whether up or down.  
  • And the second is identify the limits of currency movements, or usually we call it a support and resistance.

These two points are the basic things that we need to find out the answer before we decided to get into the market. If we can find the answer of these two basic points, then we will easily create a trading strategy. We will be easy to determine the risk and reward, we know where the stop losses and which was the target. and trading that we do will feel more relaxed and comfortable without emotion because we are trading with measurable, we know when we have an entry and when to exit from the market. We plan our trading, and we are trading with a plan. It is the basic things that are usually forgotten by novice traders and not infrequently by professional traders.

What we do against currency movements is just an estimate. We can not be sure what will happen in the next movement, but we can predict with a measure based on the history that has happened. So, with this measurement allows us to be confident about our decision.


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