Most trading tools are available on the mobile and computer platforms
Novice traders can be overwhelmed by the plentitude of trading tools out there. In technical analysis, traders have access to a wide variety of technical indicators and drawing tools to help them make sense of price action. In fundamental analysis, traders can have access to the data they need to assess the performance of different economies and companies, to help them make better decisions. In both types of analysis, it may be difficult to assess which tools are most useful.
In this article we will highlight the best tools for novice traders. You can get all those tools by clicking on the mt4 download button, and hopefully they will accelerate your trading journey.
Top trading tools for beginners in trading
- Candlestick charts. As a beginner you should learn how to read candlestick charts and trade them. Unlike line charts, candlestick charts enable you to see gaps in the markets, in addition to sentiment, which can help you make better decisions.
- Moving averages. Moving averages feature an average that moves its measured period by one step with every new candle. For example, the 50-day moving average gives you the price average over the last 50 days as of today. The next day it moves by one step forward so that the 50 days period moves forward as well by one step. You can plot the 50 and 100 daily averages on your chart in addition to others, and they often act as support and resistance when the price meets them.
- The economic calendar. Even if you are a technical trader for the most part, you need to keep an eye on the important economic news such as unemployment numbers, interest rate decisions, and others, so as to always be prepared. The price often responds to surprises in numbers rather than the numbers released themselves. Most economic calendars rate economic news by their impact, and as a trader you should pay more attention to high impact news. The economic calendar is provided by most brokers.
- The Relative Strength Index. The RSI is an oscillator. This means that it moves within two boundaries, the upper boundary which is 100 percent, and the lower boundary which is 0. Most trading platforms choose 70 and 30 percent levels as reversal levels. However, some professional traders say that 80 and 20 percent levels help you choose better entries and exits, and thus they help you time your trades better. You can adjust those levels from the settings.
- Risk calculator. You can install a risk calculator on your MT4 or MT5 platform to help you choose the right levels for your stop losses, and the right size for your trades. This helps keep risk at a minimum level and prevents your account from suffering huge losses. As a rule, you should not risk more than 2% of your account on any given trade.
Even though there are plenty of trading tools out there, using all of them and putting all of them on your chart might make things harder for you, rather than easier. Make sure you choose only a few technical indicators and stick to them, to avoid making hasty trading decisions.