Whether you operate as a part or full-time forex trader, you should know that no single investor succeeds without having access to a comprehensive sui
Whether you operate as a part or full-time forex trader, you should know that no single investor succeeds without having access to a comprehensive suite of data and analytical tools.
These tools vary wildly in their nature, while many have been designed for specific purposes and to carry out particular types of analysis. However, they allow you to make more informed decisions in real-time, which can incrementally enhance your performance in real-time.
In this post, we’ll look at some of the best tools available, while taking a closer look at the Autochartist app and asking how this can be used by forex traders.
What are the Best Analytical Tools Available?
Let’s start by looking at some of the most valuable and widely-used analytical tools for forex traders. These include:
- Session Highlighters: The 24-hour forex market is split broadly into three geographical sessions, namely North America, Europe and Asia-Pacific. Due to the way in which these markets vary in terms of size and trading volumes, many investors look to separate the sessions in order to access far clearer trends and data. This is where a Session Highlighter comes into play, as this distinguishes the sessions in charts and reveals the price action that occurred during each one.
- Volatility Tools: Next up is a forex volatility tool, which shows how much a currency pair typically moves over the course of a predetermined period of time. This way, you can see how much your target pairs typically move during each hour of the day, so you can assess potential trades in terms of their likely profitability.
- Forex Position Summaries: Some brokers provide up-to-date summaries of how their clients are positioned, identifying what percentage of traders are long or short on a specific asset. By monitoring this ratio and how it changes over time, you can gain some insight into how a particular price may move in the future and predict movements more effectively.
- Technical Indicators: This may describe the most popular type of analytical tool, while it also covers a broad range of indicators such as the MACD, RSI and moving averages. These entities all look to analyse price movements and identify viable and actionable trends, which can help to inform future trades and enable you to time your orders more efficiently.
What About the Autochartist Tool?
Of course, the forex market is a fast-moving space, so new innovations are constantly emerging to help traders operate more efficiently.
Take the Autochartist tool, for example, which works by streamlining market analysis and creating technical chart patterns that are relevant to each individual trader.
So, while Autochartist doesn’t actually trade on your behalf (despite being labelled as an Expert Advisor), it does automate technical chart patterns such as breakouts, support and resistance, wedges, triangles and more.
As a result, you can identify viable patterns that are relevant to your precise trading strategy, leading to more informed and profitable decisions in the real-time marketplace.