As I was looking through Facebook the other day, I noticed a student that had posted a comment about their takeaway from a trading expo they attended. The student commented that one “expert” said that Fibonacci is a terrible tool to use for market prediction while another claimed to have forecasted many market tops and bottoms by using it. The student was wondering what a trader should do when so many “experts” seem to contradict each other.
If you have ever attended a trading expo, you have undoubtedly been bombarded my many trading gurus who are willing to share their secret to analyzing the markets. Many of them are simply variations of common indicators that can be found in books. Others may be original, but they all share one common thing, they are based on past price and are not as good for predicting as reading price action.
A trader buying into the trend at a demand zone has a huge advantage over the one who is waiting for the stochastic to signal a buy. The crossing of the %k above the %d to signal a buy would not happen until the close of the candle leaving the demand zone. It does give you confirmation but also a higher entry price.
I hold a Chartered Market Technician’s designation from the Market Technician’s Association. I am proud of this designation as it shows that I have a high proficiency in technical analysis. The process to attain it included intensive study of many indicators and market theories over two years. I tell you this not to brag but to drive home the point that I use almost none of that knowledge in order to profit from the markets on a day to day basis.
To generate my income from trading, I use the simple core strategy that I learned at Online Trading Academy. In our courses at Online Trading Academy, we teach our students to read price action and to trade like the large institutions do. If your trading strategy is simple and rule based, you are more likely to follow it and more likely to have success. Keep your trading rules simple for the best chance of success. Have a written plan for how you will trade and follow that plan.