Trade Your Own Charts «

Trade Your Own Charts


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Trading is usually a solitary activity, but sometimes traders will trade in pairs or groups, sometimes traders will look at other traders charts, and sometimes traders will share trading suggestions with other traders. These are all perfectly acceptable things to do, as long as they are done correctly (which as you can guess, is often not the case).

Trading Charts
In theory, a trading chart of the same market, that is using the same time frame, and the same indicators, should look exactly the same for every trader, but this is not the case. For example, different brokerages provide the same market data slightly differently, which can lead to different market prices at different times. Variations in the time of each trader’s computers can lead to price bars (or candlesticks) opening and closing at slightly different times, which can cause price charts to look quite different.

These things might appear easy enough to overcome, but when a trader is trying to make a trading decision, and they are presented with conflicting information, their decision becomes very difficult indeed (if not impossible).

Decision Making
Solitary traders obviously have to make their own decisions. They have to perform their own market analysis, and then decide every aspect of their trades themselves (i.e. entry, management, and exit). Traders that trade in pairs or groups on the other hand, can in theory make their decisions together. They can look at each other charts, and discuss potential trades either in general or very specifically (i.e. exact prices). However, in reality this type of pair or group decision making would be a mistake.

Even if trading itself can be performed in pairs or groups (i.e. for company), trading decision making is not a group activity. There are several potential pitfalls of attempting to make trading decisions as a pair or group, with one of the most likely being complete indecision. Different traders have varying levels of knowledge, experience, and ability, and therefore they can have very different views of the same market.

Trade Your Own Charts
So, trade your own charts means quite literally, make your trading decisions using only your own charts, and it also means, make your own trading decisions without any input from any other traders. This would appear to be easy enough, but it can be very difficult to make an independent decision when the trader next to you is essentially telling you that you might be wrong. For example, if you have decided not to make a particular trade, but you know of another trader that has made the trade, and the trade makes a substantial profit, are you honestly going to have the will power to decide not to make the next trade that the other trader makes?

Note that there is one exception to trading your own charts, and that is when you are a beginning (or still amateur) trader, and you have specifically asked a professional trader to provide you with trading suggestions (e.g. by subscribing to a professional trader’s trading service). In this case, you would not actually be making any decisions at all (even though you might be looking at your own charts), so it is then acceptable to make your trades without trading your own charts.

 

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