When traders use oscillators for trading decisions, they often use them incorrectly. Most will wait for a buy signal from an oversold oscillator crossing the line marking oversold or they will wait for a sell signal from an overbought indicator crossing below the line. The problem with both of these signals is that they are lagging and will always signal you to enter or exit after a change in price.
In the Extended Learning Track (XLT), we teach traders to time their entries and exits based on supply and demand levels. These levels mark the areas where prices are most likely to reverse based on the simple economic laws of supply and demand. This, coupled with the fact that price action is dictated by the emotions and beliefs of the people trading them, allows us to identify turning points prior to price actually reacting. People often repeat actions that brought them pleasure and avoid those which caused pain. Supply… Continue Reading
