Keep your trading charts clean!🧹
âś…Keeping Charts Clean: Since a trader's charting platform is his or her portal to the markets, it is important that charts improve rather than hinder a trader's market analysis. Easy-to-read charts and workspaces (the entire screen, including charts, news feeds, order entry windows, etc.) can improve a trader's situational awareness, allowing him to quickly decipher market activity and react to it. Most trading platforms allow you to largely customize the color and design of the chart, from the background color, style and color of the moving average to the size, color and font of the words that appear on the chart. Setting up clean and visually appealing charts and workspaces helps traders use indicators effectively.
✅Information overload: Many modern traders use multiple monitors to display multiple charts and order entry windows. Even if six monitors are used, you should not consider every square inch of the screen as technical indicators. Information overload occurs when a trader tries to interpret so much data that in fact they are all lost. Some people call this analytical paralysis; if too much information is presented, the trader will most likely not be able to respond. One way to avoid information overload is to exclude any extraneous indicators from the workspace; if you don't use it, lose it – this will help reduce clutter. Traders can also view charts to make sure they are not burdened with multicollinearity; if multiple indicators of the same type are present on the same chart, one or more indicators can be deleted.
✅Tips for organizing: Creating a well–organized workspace using only relevant analysis tools is a process. The set of technical indicators that a trader uses may change from time to time depending on market conditions, strategies used and trading style.
❗️On the other hand, charts can be saved if they are configured in a user-friendly form. There is no need to reformat the charts every time the trading platform closes and reopens. Trading symbols can be changed together with any technical indicators without disturbing the color scheme and layout of the workspace.
âś…Recommendations for creating easy-to-read diagrams and workspaces include:
⏺Colors. The colors should be easy to view and provide great contrast so that all data can be easily viewed. In addition, one background color can be used for order entry charts (the chart that is used to enter and exit a trade), and a different background color can be used for all other charts of the same symbol. If more than one symbol is traded, you can use a different background color for each symbol to simplify data isolation.
⏺Layout. Having more than one monitor helps to create a comfortable workspace. One monitor can be used for entering orders, and the other for price charts. If the same indicator is used on several charts, it is recommended to place similar indicators in one place on each chart using the same colors. This makes it easier to find and interpret market activity on individual charts.
⏺Sizes and fonts. Bold and clear font makes it easier for traders to read numbers and words. Like colors and layout, font style is a preference, and traders can experiment with different styles and sizes to find a combination that creates the most visually pleasing result. Once convenient labels are found, fonts of the same style and size can be used on all diagrams to ensure continuity.
⚠️It is important to note that technical analysis deals with probabilities, not certainty. There is no combination of indicators that accurately predicts market movements in 100% of cases. While too many indicators or improper use of indicators can blur a trader's view of the markets, traders who use technical indicators carefully and effectively can more accurately determine trading attitudes with high probability, increasing their chances of success in the markets.
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