The Capital
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The Capital

Blind Trading

By Ali H. Askar on The Capital

Blind trading the financial markets

We live in an era of limitless information. You can pull out your phone and amass massive amounts of data within seconds. However, when it comes to major financial markets, a large majority of traders prefer to utilize only information offered to them from popular charting platforms. When beginning to speculate in these markets, uninformed traders may watch a few videos, read a few articles on basic trading strategies, and then apply what they’ve learned to attempt to profit off of the markets.

They think that if they have seen evidence that a strategy has worked in the past, it will work in the future.

The harsh reality of the market is that the retail trader is set up to fail from the start. The market is zero-sum as one trader’s gain is another trader’s loss. If I buy at a market bottom, I need another trader to sell on my limit buy order at that market bottom. If I sell at a market top, I need someone to buy on my limit sell order at that market top. A trader’s chance at success in any trade can be measured by the ‘edge’ that they have in the market that they are trading. The beginning trader who simply absorbs information they found online or heard about from a friend, and then applies to the market of their choice, hoping for the best, is trading without any inherent edge. In the long-run, this trader will find it near impossible to consistently profit and will likely lose all capital that they had placed with their broker.

Technical Analysis and Mathematical Indicators to trade or not to trade!

Technical analysis is a subject that partitions online trading communities. Your first idea may be that traders are quarreling about which indicators and technical analysis arrangement will convey the best outcomes. However, in reality, traders are typically discussing the idea of trading financial markets without indicators.

Trading without indicators may appear to be disputable. However, there is a developing clan of market traders who are making and pushing new strategies without indicators or technical analysis. While we know there are some reasonable contentions against utilizing an excessive number of indicators in your outlining setup, a few traders go above and beyond to claim that no indicators are required for a profitable and practical trading strategy.

We analyze the possibility of Forex trading without indicators, developing the idea described in this article.

too many technical mathematical indicators

What is the Problem with Using Indicators?

The issue isn’t such a great amount with utilizing indicators themselves, yet what number of them the traders attempt to use immediately.

It’s notable that an excessive number of indicators can prompt disarray, clashing messages, and deceiving signals. On the off chance that you sit tight for such a large number of affirmations from an assortment of indicators, you may find that when you at long last settle on your choice, it’s past the point where it is possible to get better than the best entry point.

As the entirety of your indicators adjust to show an accord on the pattern you had planned to ride, it could have depleted itself or left you with simply the last part of liberal price development. Getting in past the point of no return implies, you pass up a lump of profit and get in at the danger of inversion develops.

Why Traders tend to Avoid Indicators?

MetaTrader 4 or all other mainstream trading platforms are stacked with many technical analysis indicators. There are even a lot of kinds of moving averages. Most new traders feel constrained to consider them all, at that point with such covering data, attempt to apply it.

Some new traders may even wind up sliding into the bunny opening of outsider indicators searching for the holy grail, never to discover it. The following stage after that? Googling phrases like basic Forex trading system without any Indicators, another long street to no place.

Forex Strategies Without Indicators

Basically, trading without indicators is upheld on the grounds that the strategy centers around current market developments, not historical ones. These traders see current prices, rather than past prices. This trading procedure is known as price action trading and is applied to a small timeframe as in intraday trading.

The pundits of price action contend that the philosophy of day trading without indicators depends on intuition and tuning in to your gut, like betting. Be that as it may, price action trading goes more in-depth than utilizing instinct. The procedure is generally embraced by full-grown traders who have different long periods of trading experience added to their repertoire. What the pundits neglect to comprehend is that Price Action trading prohibits regular technical analysis indicators, however, it doesn’t imply that no indicators are utilized at all.

Forex Indicators That Give an Edge

Price action traders and others, hold the supposition that everybody is utilizing similar indicators. Banks, market makers, brokers, calculations, and countless self-trained leisure activity traders all brag a similar toolbox. So in case, you’re making your moves a similar route and simultaneously as every other person, you’re continually going to be past the point of no return.

In case you will be in front of the pack and your entry point in before a market breaks out, you have to get your bits of knowledge some other way. Rather than utilizing indicators like moving averages and Bollinger bands, price action traders concentrate on candlestick designs and decipher various shapes and developments. This is as real-time as it gets. Or on the other hand right?

On most trading stages (presumably every one of them), the littlest timeframe on a candlestick diagram is 1-minute. Assume you are trading a price action procedure, that implies your watching information that can be as long as 59-seconds old. It’s a paradox that candlestick diagrams show real-time price action information. Another misinterpretation is that each trading marker utilizes past prices then they can just mention to you what’s as of now occurred, correct? Wrong.

There are plenty of trading indicators that work on real-time information and show truly actionable data that can bolster the choices made by a transient price action trader.

How about we investigate a few instances of real-time apparatuses that permit you to appreciate a cleaned up graph while day trading without indicators.

Depth of Market (DoM) — Order Flow

By approaching the order book of the market, your trading can give you significant knowledge into the depth of the market. The order book shows resting limit orders from different members and refreshes, and new breaking point orders are included and coordinated with market orders or other limit orders.

The arrangement of the DoM shows how the price is moving on an increasingly granular level. This marker even gives you a preview into what’s to come. What you are watching are orders that haven’t been executed at this point.

bookmap order flow

Market Sentiment

Plenty of traders use indicators and price action to attempt to anticipate what the market will do before it occurs. Consider the possibility that you could comprehend what different traders really are doing.

Knowing whether traders are long or short would one say one thing, yet consider the possibility that you could realize how dedicated traders are.

the crowd is always wrong

Is it Possible to Trade Forex Without Indicators?

It is completely conceivable to trade without technical analysis indicators effectively. How you decipher and apply the data from your trading strategy is remarkable to you. In the event that indicators don’t work for you, don’t utilize them. Others ought not to direct their trading arrangements, and you ought not to hear them out. The goal is to nail down a framework that works for you.

The key message we trust you detract from this article is that not utilizing technical analysis setup doesn’t mean trading totally bare. There is an enormous assortment of price and sentiment indicators that can help price action trading systems and different techniques concentrated on perusing the current price conduct, not past prices.




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Ali H. Askar

Ali H. Askar

A Quant Trader | Data Scientist | can I help you?

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