The ATR (average true range) indicator is the single best indicator that all FOREX traders should be using for all trades (use it or lose it).
You can put ATR indicator on your chart always and/or just glance at number (in upper left) and take it off your chart, just have it handy always.
What is the ATR: (Default setting (14) works fine for me in FX trading.
It tells you how many pips the currency pair has moved, on average, in the past X amount of candles.
Why you should be using ATR 100% of the time on every trade:
1) The ATR is crucial for Money Management
2) Money Management is crucial to winning
*Know that money management is what will separate you from the losing traders.
How To Use ATR In Setting Up Trades: (Never Trade Without It)
1) To know how far back from entry price away your stop loss, which is either ATR x 1.5 (works mostly) or ATR x 2.0 (if you want larger stop loss)
2) To know where to place profit targets and/or targets, 1st target is same as risk or stop loss is and 2nd target is double what the stop loss is.
When you are describing Forex RISK, instead of saying unit size or dollar amounts, instead say How much are you trading per pip?
Using the ATR will prevent you from getting stopped out of more trades, will keep in more trades. The professionals use ATR for stop losses and targets. ATR can be used on any time frames, but look for other evidence like price action at support and resistance areas, fib ret (golden zone) 50%-61.8%, pivot points, doji candles, harami setups, and engulfing setups to use ATR indicator for possible trades.
You can put ATR indicator on your chart always and/or just glance at number (in upper left) and take it off your chart, just have it handy always.
What is the ATR: (Default setting (14) works fine for me in FX trading.
It tells you how many pips the currency pair has moved, on average, in the past X amount of candles.
Why you should be using ATR 100% of the time on every trade:
1) The ATR is crucial for Money Management
2) Money Management is crucial to winning
*Know that money management is what will separate you from the losing traders.
How To Use ATR In Setting Up Trades: (Never Trade Without It)
1) To know how far back from entry price away your stop loss, which is either ATR x 1.5 (works mostly) or ATR x 2.0 (if you want larger stop loss)
2) To know where to place profit targets and/or targets, 1st target is same as risk or stop loss is and 2nd target is double what the stop loss is.
When you are describing Forex RISK, instead of saying unit size or dollar amounts, instead say How much are you trading per pip?
Using the ATR will prevent you from getting stopped out of more trades, will keep in more trades. The professionals use ATR for stop losses and targets. ATR can be used on any time frames, but look for other evidence like price action at support and resistance areas, fib ret (golden zone) 50%-61.8%, pivot points, doji candles, harami setups, and engulfing setups to use ATR indicator for possible trades.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.