First of all, futures trading is NOT for everyone. You could lose all your money very quickly, so please proceed with caution. Secondly, it is crucial to understand the ins and outs of this type of trading before you start putting down your hard-earned cash.
Profit margins in futures trading are typically high compared to other types of investments. The trick is understanding where prices are headed next. You want to predict market changes before they happen so you can maximize your returns when markets go up and minimize losses when markets go down. This is called technical analysis. cloud forex crm A lot of people use charts to do this type of technical analysis. No matter how the market goes in Hong Kong, proper technical analysis will help you see where it’s headed next.
A line chart can show you a trend in one direction or show the price variations in the stock market over time. It is the ideal device if you want to see long-term trends and don’t care much about what’s happening in the short term. Many traders use this chart to notice that prices are getting closer to their next support level. If prices consistently close below this support, then this means that you should sell your futures contract before its value goes down any further.
Sometimes when you look at a line chart all day, every day, watching every little blip and bump without seeing anything obvious, it might start to get hard for even experienced traders to see anything. In these cases, a candlestick chart can be handy. Instead of just looking at one number, you can look at both an opening and a closing price. Look for times when your indicators line up with a support or resistance level on a candlestick chart to help determine whether it is time to buy or sell.
Intra-day trading is a way of trading that typically takes place within the span of a regular trading day. It’s not suited to everyone, but it can be advantageous when you want to get in and out fast or break down a trend into smaller chunks. Bar charts are perfect for this task since they show each set of hours or days as a “bar” on your screen with highs, lows, and closes, all clearly marked. This type of chart also allows you to zoom in on any specific time frame, so you don’t have to see what happened over previous weeks if all you need is several hours worth of data. Additionally, moving averages can help indicate where prices are headed next, just like on a candlestick chart.
Vertical or horizontal bar graphs
It comes down to personal preference as there are many different types of graphs. A vertical graph may be easier to read if you don’t want to spend too much time looking at the number scale since prices are shown more clearly. It’s also possible for some line charts to switch between vertical and horizontal formats depending on how their data is configured.
Line and bar charts
Combining a line and bar chart can give you the best of both worlds. Line charts help you see where prices are headed on a long-term scale, while you can enlarge bar charts for more detailed information. It’s also possible to use your computer software to overlay several graphs at once so that you can choose which type of information is most beneficial to you, given the types of market conditions occurring right now.
This can give you an advantage that other traders don’t have.
What are the advantages of using charts in futures trading?
- You can predict where prices are headed next, which can help you to maximize returns and minimize losses when trading futures in Hong Kong.
- There are different types of charts that offer different advantages, which makes it possible to choose the most suitable chart based on what’s happening in the market at any given time.
- Using your computer software makes it possible to overlay several graphs so that you can see all of this information at once. Meaning you won’t have to move back and forth between different charts to get an overview of where prices are headed next. This way, you can make knowledgeable decisions about the best course of action without getting bogged down by too much data.