Traders like to make use of indicators in their trading but, oftentimes, they resent the fact that they “lag the market”. This question again came up during last night’s webinar on Moving Averages.
Keep in mind, that all indicators are going to “lag the market” to a greater or lesser degree since they are all based on an average of price action that has already taken place. Moreover, the longer the chart time frame we use or the greater the number of periods analyzed by the indicator, the more of a lag that we will see.
Even though every trader would like to be in on the very first pip of a move, it is fine to miss the initial move that a pair makes in favor of entering a trade that has a greater level of confirmation behind it.
Yes, absolutely. In fact, if you adopt this mindset early, you’re already ahead of most beginners who lose money trying to "time the bottom." In the crypto world, we have a saying: "Don't try to catch a falling knife." If you try to enter at the very first pip of a move, you're essentially guRead more
Yes, absolutely. In fact, if you adopt this mindset early, you’re already ahead of most beginners who lose money trying to “time the bottom.”
In the crypto world, we have a saying: “Don’t try to catch a falling knife.” If you try to enter at the very first pip of a move, you’re essentially guessing where the floor is. Waiting for confirmation is like letting the knife hit the ground and move a bit before you pick it up—it’s much safer for your fingers (and your wallet).
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