5 step guide to keep your Technical Analysis simple

Advantages of technology are counter productive some times. Internet has made us available plethora of information, but its very difficult to choose the right piece of information from all the stuff available after a simple google search. 

Similarly in Technical Analysis, there are so many ways and means of doing the analysis, so many tools to use, so many methods and so many techniques. Add to it, so many good charting software available in market, makes it difficult to choose a right one for an individual trader. A first hand learner usually find himself lost in the sea of indicators, oscillators and averages and what not.

Its about choosing the best that suits your trading style. Here is a 5 step guide to keep your Technical Analysis simple -

1. Decide your objective- Decide whether you want to be Trader or a Student. If you are a trader then confine yourself to learn only that much (at least during your initial trading days) which is required to your trading style. You can just pick them randomly, if you don't know what to look for. If you are a student and just want to learn Technical Analysis for purposes other than trading then access all the information available through sources like internet. A trader must not get himself lost sea of information. Instead its about rejecting what comes your way. Don't spend hours watching You Tube videos of indicators / oscillators not of use to you.

2. Use the basic- Confine yourself to basics like Trend, Support/Resistance, Candlestick Patterns and Chart Patterns. These are the basic tools one should use to take buy / sell / hold decision. Indicators, Oscillators and Moving Averages are just the support tools. Don't use them for decision making. Rather use them to support your buy/sell decision. In My Courses I thrust on using the basics and use of only one indicator that will support your decision.

3. Perfect a few of them- Instead of learning lot of things available in the field of Technical Analysis, use and try and perfect only couple of them. Any tool in Technical Analysis is actually understood after using and practising it over a period of time. Do lot of back-testing or paper trading on one or two set of tools which you are comfortable with. Practising few things is rather more important than learning many things.

4. Trading is not only about analysis- Trading in not only about analysis. Be it Technical or Fundamental. There are many important things like Risk Management, Money Management and Psychology Management. These things play a rather important role than any analysis in your trading success.

5. Take a break- More analysis does not mean more perfection. More tools does not mean greater success. More analysis does not mean more money. Take a break, decide your set of tools (in technical analysis) as a pat of trading plan and strategy. 

Any analysis play only 40% role in your trading success. So don't be over complicated. You will earn good profits even if you are 'right' only in 65-70% of the trades with correct Risk Reward Ratio,