John Murphy’s name is known to any serious trader. His technical analysis book should be in the library of every trader who use technical analysis.
The full article you can read on the IQoption blog but if you do not have a lot of time here is just the important info.
The most important John Murphy’s laws for successful trader:
1. Trend is your friend – probably the most well known quote.
Here is an example of downtrend:
Here is example of trendless chart:
John Murphy’s rule is to Follow the Trend. Use of: classic resistance levels along with Fibonacci levels.
Confirm the trend few times so the movement direction is strong. Draw trend lines.
Here is an example of triple confirmation uptrend:
It’s important to spot trend reversals. John advises to use RSI and Stochastinc for spotting trend reverse.
Volume – larger than usual volume confirm trends. Smaller volume end of the trend.
Remember that the knowledge is not enough. Only experience and constant learning can make sure that you will be a successful professional trader one day.
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