Forex trading requires traders to analyze the market and make informed decisions based on the information they have at hand. One of the best ways to do this is by using forex charts to visualize the market trends and movements.
In this article, we will explore how to put three forex charts up and trade the information effectively.
Step 1: Choose the right trading platform
Choosing the right trading platform is the first step to trading forex. There are several trading platforms available, and each has its strengths and weaknesses. For this article, we will use the MetaTrader 4 (MT4) platform.
MT4 is widely used by forex traders around the world, and it offers a range of features that make trading easier, including customizable charts, technical indicators, and automated trading.
Step 2: Open three charts
Once you have downloaded and installed MT4, the next step is to open three charts. To do this, follow these steps:
1. Click on “File” in the top left corner of the platform.
2. Select “New Chart” from the dropdown menu.
3. Choose the currency pair you want to trade from the list of symbols.
4. Select the timeframe you want to use for the chart (e.g., 1 hour, 4 hours, daily).
5. Repeat steps 2-4 for two more charts.
Step 3: Customize the charts
Now that you have three charts open, the next step is to customize them to display the information you need to make informed trading decisions.
You can customize the charts in several ways, including:
1. Adding technical indicators: Technical indicators are mathematical calculations based on the price and/or volume of a currency pair. They can help you identify trends, momentum, and support and resistance levels. To add a technical indicator to a chart, click on “Insert” in the top toolbar and select the indicator you want to use.
2. Changing the chart type: MT4 offers several chart types, including line charts, bar charts, and candlestick charts. Each chart type displays the same information differently, so it’s important to choose the one that works best for you. To change the chart type, right-click on the chart and select “Properties” from the dropdown menu. Then, choose the chart type you want to use.
3. Customizing the colors: You can customize the colors of the charts to make them easier to read. To do this, right-click on the chart and select “Properties” from the dropdown menu. Then, choose the colors you want to use for the chart elements (e.g., background, gridlines, candles).
Step 4: Analyze the charts
Now that you have three customized charts, the next step is to analyze them to identify trading opportunities.
There are several things you should look for when analyzing forex charts, including:
1. Trends: Trends are the direction in which the price of a currency pair is moving. You can identify trends using trend lines or moving averages.
2. Support and resistance levels: Support and resistance levels are the price points at which the market has historically struggled to move above or below. These levels can help you identify potential entry and exit points.
3. Price patterns: Price patterns are recurring formations that can signal a reversal or continuation of a trend. Examples of price patterns include head and shoulders, triangles, and double tops/bottoms.
Step 5: Place trades
Once you have analyzed the charts and identified a trading opportunity, the next step is to place a trade.
To place a trade on MT4, follow these steps:
1. Double-click on the currency pair you want to trade in the “Market Watch” window.
2. Click on the “New Order” button in the top toolbar.
3. Choose the type of order you want to use (e.g., market order, limit order).
4. Enter the lot size (i.e., the amount of currency you want to trade).
5. Set the stop loss and take profit levels.
6. Click on the “Sell” or “Buy” button to open the trade.
Conclusion
In conclusion, putting three forex charts up and trading the information can be an effective way to analyze the market and make informed trading decisions. By customizing the charts, analyzing the trends and price patterns, and placing trades using MT4, you can increase your chances of success in the forex market.
