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Trading Tools for Quick Market Analysis

Trading Tools for Quick Market Analysis

2014-10-15 19:00:00
Walker England, Forex Trading Instructor
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Talking Points:

  • DailyFX tools can assist you in your technical trading
  • The Technical Analyzer covers CFD’s and currency pairs
  • Follow the preferences of the Analyzer or use them with your own strategy.

Trading a technical strategy can have its challenges, one of which is how to quickly analyze and asses the market. To help in this process, DailyFX has a wide variety of charting resources available to assist traders in navigating the twists and turns of the market. The Technical Analyzer found on DailyFX PLUS, is a tool which displays trading ideas, key pricing levels, and indicator updates for your favorite CFD’s and Forex pairs. To get acquainted with this resource, today we will review exactly what the Technical Analyzer offers, and how it can be used by any active trader.

Analysis for CFD’s and Forex

The Technical Analyzer is a great tool for getting current market updates, whenever you are ready to trade. As seen below, the Technical Analyzer tracks key markets including CFD’s such as gold along with a variety of currency pairs. This way regardless of whether you are trading the US30 (Dow) or the GBPUSD, you can find pertinent trading updates and analysis at your convenience.

Once you have found an update to review, you will also notice that the Technical Analyzer gives a short term (ST) and mid-term (MT) market outlook. Short term denotes the outlook for the asset for the next 1-2 weeks. This differs from the midterm analysis which looks to forecast market direction out to a month. The analysis itself is fairly straight forward and designed to give the trader a quick opinion of the market. A green arrow indicates a bullish bias, while a red arrow indicates negative expectations. Now once you have selected what you want to trade, simply click the attached hyperlink to get the full technical story.

Trading Tools for Quick Market Analysis

The Technical Story

Once you have selected your favored asset for trading, it’s time to review the market’s current technical story. First off the analyzer provides a key update regarding current price. This is included under the summary tab, which gives a descriptive summary of what is happening with your favorite currency pair or CFD. Next, based off of this information is a trading preference. Here the analyzer provides potential trade ideas along with targets based off of the Analyzers summary. This story also includes an alternative scenario. In the event the market begins moving in the opposite direction, key pricing levels are given for trading opportunities in this opposing direction.

Lastly, the technical story includes key levels of support and resistance. Even if you’re not looking for trading signals, these pricing points are key areas in price to look for throughout the day. These values can then be worked into your own trading strategy or simply used as potential pricing targets or extensions. Regardless of your preferred trading, the information can help you quickly assess the market while developing an educated trading opinion. Now let’s look at the final charting component which is the basis for the analyzers trading preferences.

Trading Tools for Quick Market Analysis

The Charts

If you are interested in technical indicators and the analytics behind the analyzer, this information will be outlined in a provided chart. Below we can see today’s example, using a 30 minute GBPUSD chart. First, traders will notice the lines of support and resistance, which are provided above but now added to the graph. The central pivot from where the trading bias is created is denoted with a blue horizontal line. Resistance lines are colored in green while key levels of support are labeled in red

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Analysis through the Technical Analyzer includes the use of indicators. The analyzer will often use both a 20 and 50 period MVA’s (Simple Moving Averages) to help gauge market momentum. Also note the inclusion of RSI (Relative Strength Index). This indicator is helpful in determining both overbought and oversold levels which are beneficial to traders. If you don’t know what any of these indicators mean, don’t worry! The Technical Analyzer will include key updates to indicators in the stories mentioned while explaining any updates to your favorite CFDs and currency pairs.

Trading Tools for Quick Market Analysis

Getting Started with the Analyzer

As you can see the Technical Analyzer is a great tool designed to help you quickly create an opinion of the market. This tool is available to all FXCM account holders, but if you are new to trading you can register for a free trial of the Technical Analyzer. To claiming your free trial, click the link below.

DailyFX.com Education & Trading Tools

Also make sure that you practice your trading with a Free Forex Demo. This way you can follow along with the analysis of the Technical Analyzer in real time, while developing your own technical trading skills!

Click HERE to Register Now

---Written by Walker England, Trading Instructor

To contact Walker, emailinstructor@dailyfx.com. Follow me on Twitter at @WEnglandFX.

To be added to Walker’s e-mail distribution list,CLICK HEREand enter in your email information

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

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