Auto Fibonacci Indicator For MT4
The Auto Fibonacci Indicator For MT4 is an indicator that is built on the Meta Trader 4 charting and trading platform and also for all of the traders that use the charting and trading platform for doing all of their charting of the individual timeframes that make up the trader's favorite or selected currency pairs, who do their technical analysis and who use the platform in order to make trading decisions during the trading day.
The indicator is very sturdy and is a leading indicator because of its predictive ability. The Auto Fibonacci Indicator For MT4 is built based on the Fibonacci principles and the zigzag indicator and it can help the trader to identify the likely reversal points for trends in the market.
Traders can easily use the indicator to derive a lot of trading insights during the trading day. Some of these insights and advantages that the trader using the indicator can derive are outlined and discussed extensively below as follows.
Some of the Major Advantages and Disadvantages of using the Auto Fibonacci Indicator For MT4
One of the first important advantages of using the Auto Fibonacci Indicator For MT4 to the trader that is worthy of mention is that the indicator can help the trader to identify the areas in the market where the prices of a particular currency pair or trading asset are most likely to reverse.
This means that the trader who attaches the indicator to his or her trading charts will be able to spot those price areas where he or she can very easily expect the price to reverse.
This is possible since the indicator is built based on the Fibonacci principles that are predictive by their very nature and which have already been used by traders all over the world to try and predict the movement of the markets on any given trading asset or currency pair for several years.
This is very important to the trader for several reasons. One of the reasons why this is very important is that it can help the trader to spot what the new trend direction is ahead of the time before that new direction even pans out and before other traders can take advantage of it.
This means that the trader who has the indicator attached to his or her trading charts can easily predict ahead of the time and to a great degree of accuracy exactly which points in the markets the price is most likely going to reverse.
This will then help the trader to be able to take full advantage of trading signals that arise in this new direction before the other traders are even aware of it because he or she would have already preplanned their trades while they wait for the markets to finally reach the points where he or she can then get into the trade.
This helps to keep the trader very organized as he or she will then be able to work through their trades before the signals appear and be able to ensure that they are fully prepared to take the signals arising from such trades even before the market make such opportunities available to the trader within the trend.
This will also help the trader with managing his or her trading risk as he or she will never be in a hurry to take trades such that he or she would not be able to plan for how much of their trading portfolio that they will risk on the particular trade even before that particular trade shows up.
A lot of traders who lose money in the markets do so because they lack the patience and the preparedness to stick to a specific risk strategy. Without an appropriate risk strategy, it is just a matter of time before the trader's account runs into trading losses.
This is because, if the trader does not set specific guidelines for exactly how much risk they will be taking out of their entire trading account, the trader would most definitely get to a point where he or she would definitely over risk on a particular trade. This is because a trader is human and as such is prone to getting emotional during the trading day.
Once a trader then gets emotional during the trading day, he or she immediately becomes very vulnerable to trading mistakes. Such mistakes could be due to being afraid of taking new trading positions in the market because of previous trading losses, or trying to trade out of a feeling of the need to revenge because of a loss.
Whatever the feeling is, once there is an emotional reaction to the markets, the trader immediately becomes prone to trading errors and will easily lose money. This is the reason why the trader needs a solid trading strategy.
Such a strategy will then be able to guide the trader when he or she runs into a series of losing trades. A lot of traders do not realize that one of the most common things in the markets are losing strings. This means that predominantly, the markets can easily behave in such a way that it causes the trader a continuous period of losses.
Hence, a trader has to be able to understand this and structure their trades and trading strategy so that it can be accommodating of such periods in the market. A piece of general advice to traders is that they should never risk more than two percent of their entire trading capital on a single trade since the markets can easily drive the trader into a string of losing trades.
That way, when the market makes the trader lose a lot of trade, the trader will still know that he or she is safe and that no matter what happens, it will take the trader about 50 different losing trades before he or she loses their entire trading capital.
This will help the trader to avoid losing their trading account in a little number of trades and will help the trader to stay confident as he or she takes trades during the trading day.