Patrick Kinsel Head Analyst, FX Trading
Patrick Kinsel Head Analyst, FX Trading

Harnessing e-tools in Trend analysis, by Patrick Kinsel

First Published: e-Forex Magazine 24 / Traders Workshop / July 2006

The ability to recognize a trend is one of the most important skills any trader can harness. The FX market, like other financial markets, will trend upwards, downwards, or sideways over varied timeframes. If a trader can learn to discern which direction the market is trending, they position themselves to succeed greatly. Today, as a result of increasingly sophisticated charting packages and trading platforms, even novice traders are easily able to utilize sophisticated indicators to help recognize trends.A trend is simply the overall direction of the market. At some points, trends may be easily recognizable. At other times, trends may be overshadowed by wild market fluctuations or hidden within a ranging currency pair. Failing to recognize a trending market can mean death to even the most skillful trader. For example, if a trader shorts a currency pair at what they perceive to be a strong resistance point, but fails to recognize the market’s overall upward trend, they may be on the wrong side...continued

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