At one point in my trading journey I got caught up in the Indicator Frenzy. I'll bet I had a hundred. Many were indicating nothnig in particular, most were indicating the malfunction of the others! I was lost in a paradoxical insoluble, a veritable quandary!

With all these high tech, expert diagnosing, super sensitive, parameter tweaked indicators, surely I could defeat the ignorant market participants. Unfortunately, many of the other participants were way ahead of me. They had been there, done that, and were wearing nifty T-shirts featuring P.T. Barnum ("There's a sucker born every minute"). I swallowed my pride and began to regroup.As I began to develop my trading wings, I realized that my puny brain was not capable of assimilating this massive amount of information. My trader soul was screaming "KEEP IT SIMPLE, STUPID!"

Focusing on indicators will result in false signals and bad trades. Torturing your brain with massive amounts of information will also result in bad trades. The markets are polluted with TMI (too much information).

The trader must whittle it down to a manageable level to conserve your time, your sanity, and your psychological state of mind in order to perform as a rational trader. No matter how smart or how well organized you are, an overload of information will not improve your trading. A general consensus of opinion will cloud your objectiveness.

Conflicting opinions are like conflicting indicators. Useless.

The trick is not the number of indicators you use and not necessarily which indicators you use. Try to narrow it down to 2 or 3 indicators and understand what they are telling you. I don't use indicators for trading signals and I don't make trades based on indicators.

I use indicators to confirm what price action is already telling me. I also use indicators when trading divergence. My technical analysis begins with the basic skills of determining support and resistance, then moving on to Fibonacci. Indicators have their place in my trading program but not my focus.

Thanks for reading my article. To learn more please visit one of my educational websites.
http://www.lakeside21.com/
http://www.2tradesmart.com/

The financial markets are risky. Investing is risky. Past performance does not guarantee future performance. This article has been prepared solely for informational purposes and is not a solicitation, or an offer to buy or sell any security,currency, or asset. Opinions are based on historical research and data believed reliable, but there is no guarantee that future results will be profitable

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