Trading with no technical indicators is an alternative to the traditional approach. Millions of technical traders have been applying indicators for years. However, there is a concept where you can open and close trades without using them. The system is not new. Some experts have been successfully implementing it.
So, in this article, we will discuss the potential benefits and downsides of trading without technical indicators.
It is the way of buying and selling currency taking into account the asset price movement instead of using data generated by indicators. Although the concept sounds a bit strange and new, many traders have been using it for years. The system is a bit undervalued, as trading is associated mostly with indicators for the majority of market participants.
No one will ever doubt that technical analysis is of great use. However, it does not mean it is the only approach. An indicator is only a piece of software that helps you make the right decisions depending on the data it generates.
Note: technical indicators utilize the data about past price movement and the way it affects the current price or trends.
Here are several downsides of using indicators:
Instead, price action trading or trading with no technical indicators is faster and simpler, which makes it a good option for beginners. You do not have to set up your strategy or learn how to use specific tools.
Additional reasons for traders to select this particular approach include the following:
Both approaches can be quite risky and unpredictable. Whatever system you choose, you still need to apply at least baseline risk and money management tools.
The technique supposes using price action as an instrument for determining the best market exit and entry positions. While you are not planning to use tools like stochastic oscillators and moving averages, you can enable your trading using the following approaches:
The following will let you quickly get started.
The key to success is to have a total understanding of what is going on in the currency market. Not having indicators by your side, you can have a better view of the situation, as you can rely on your own analysis rather than trying to interpret information generated by a program.
As a result, beginners can eventually grow into independent traders with the ability to trust their studies and judgments. When you only rely on indicators, the possibility of missing some important points is high. When you trade on your own, you are learning to generate and read your signals and avoid mistakes that can potentially cost you a fortune.
Trading without indicators is a great option for beginners. It is a chance for them to learn how to put emotions aside and keep control over their strategies. At the same time, newbies do not have enough experience to use it as the foundation for future success. So, the best idea is to enter the market with not more than you can afford to lose. Additionally, using risk management tools is vital. Create a plan, stick to it whatever happens or use copy trading to learn from the best in real-time.
This material does not contain and should not be construed as containing investment advice, investment recommendations, an offer of or solicitation for any transactions in financial instruments. Before making any investment decisions, you should seek advice from independent financial advisors to ensure you understand the risks.