Many traders find it difficult to interpret the market using different indicators. The main indicator used by many traders to analyze the financial market direction is Relative strength indicator which serves as an oscillator indicator and moving average which serves as a trend indicators. When traders who are not familiar to such kind of indicator they try to use them on their candlesticks chart, it confuses them a lot. These trading indicators end up not working for them thus for some they end up giving on them thus trying to look for an alternative that they can use to analyze the market direction. Many traders don't know that with candlesticks chart alone, you can be able to analyze the direction of the financial market and you end up becoming a profitable trader. The only thing that you only need to know is just to know on how to draw the trendline and you will be good to go. Today, i will help you know on how to analyze the direction of financial market without using any trading indicator.The only thing you need to know is the concept of demand and supply as well as how these two are applied in oversold and overbought market condition. Here is the candlesticks chart showing much detalied information;
From the candlesticks chart above, there are 3 points, point A, B and C. Initially before point A, the market was moving downwards. At point A, the market gained an upward support since the number of sellers have exceeded the number of buyers at that point thus being considered an oversold market condition point. Because of this, the market is starting to move upwards as indicated. At point B, the number of buyers again exceeds the number of sellers thus creating a downward market pressure again thus causing more sellers to enter the market again since the market is starting to move downwards. At point C, the number of sellers have exceeded the number of buyers again thus creating an upward market pressure again. This will cause more buyers to enter the market again since the market is starting to move upwards once again. This process will keep on repeating itself until the market has fully gained an upward support since it was initially moving downwards. As a trader, if you are not a fun of trading indicator, you can then draw trendlines to help you in analyzing the market direction. You will still become a profitable trader since you will be able to know when to enter and exit the market.
As you can see from our graph, our first entry for the buy position was at point A while our first exit was at point B . Our second entry point was at point C since at that point, the market was able to fall below the previous price at point A. As i always say, make sure to apply risk management if you want to succeed in trading. Also make sure to apply the strategy which you had initially created because
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