Analytical Tools Helps Traders!

Discussion in 'General Trading Discussion' started by TraderAnalyst, Aug 17, 2019.

  1. TraderAnalyst

    TraderAnalyst Senior Investor

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    When traders think of taking investment decisions efficiently then he may think of conducting proper analyses. Technical and fundamental analysis is the two basic analytical tools that are being used the traders today. When it comes to quick fix technical analysis can be a reliable alternative. But fundamental analysis is the long term but one of the most effective analytical tool so that traders can see the real values of trading.
     
  2. J_C_Anderson

    J_C_Anderson Senior Investor

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    Both types of analysis are important equally. Fundamental analysis gives understanding of the situation in general and helps trader to find out the reason of the movement, while technical analysis allows to get into the position with the best possible risk-reward ration. Thus, each trader should have at least basic understanding of both these types of analysis to be able to apply them when necessary. Each time entering a position trader shall evaluate technical and fundamental criteria to make sure that his idea is resonable. Some traders even wait for the price action to confirm their bias - this means that other market participants have the same positions. It works best on effiicent markets with the large share of qualified participants.

    There are many different tools that help traders and simplify trading process. To my mind, the most useful is Forex Tester - special backtesting software that gives possibility to check ideas and strategies using historical data provided by the brokers. As the result, trader will get detailed information on the performance of the strategy and will be able to make changes if necessary.
    Another impotant tool for trader is MS Excel. It is the best solution for recording trades and working with trader`s journal. Of course, trader should be familiar with it to be able to use its advanced features.
     

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