What I expect from a chart

I’m often asked, with reference to my ‘fighter pilot’ days, if I ever miss it? Meaning, do I miss the flying. Mostly I don’t, and the person asking the question seems surprised by my answer.

That is because they didn’t ask the right question. Flying the aircraft, once learnt, is the easy bit. The operation, leading the 8-ship of fighters at ultra low-level through heavily defended areas to engage a target hundreds of miles away to within a margin of a few seconds, is the hard part.

And, it is the operation that I miss. Okay, not true, I watched the Red Arrows perform at Holkham this week and lived the moment, briefly.

Technical trading has similarities, albeit only two-dimensional. Familiarity with a chart, and a chart that does everything we want of it, is like flying an aircraft – when we can fly one we can have a confident go at flying anything. How to trade, develop and implement strategies is the operational equivalent.

I lost some confidence in my usual chart and broker last week when I was unable to exit a trade after the price moved rapidly, fortunately in my favour. With high volatility occasionally a broker is unable to provide a desired exit price and leaves the trade open. This, however, was not that. I was simply locked-into the trade. In hindsight the initial clue that all was not right, was the breakdown in the representation of some of my charts that I monitor on a higher time-frame.

Why, as I was in a favourable direction, was it a problem to be locked-into the trade? It is disconcerting, moreover, I had tried to exit with a scalp, and before the bar bounced, and then would have held a portion of the trade for a swing target. When I discovered that I was ‘locked-in’ my whole concentration was on getting out (completely) which I achieved some way up the bounce. This was for a profit but a good way short of the target potential.

Because of this, several days were taken to revisit other brokers to find a stable platform that does everything I want. Time consuming, but a worthwhile exercise. As a day-trader on lower time-frame charts the following are important to me: (1) spread; (2) reliable, clear charts linked to the broker that provide on chart dealing – importantly on-chart ‘limit’ entries with the ability, on chart, to set target and stop positions (3) as well as a chart zoom capability, I like to be able to grab and move the collective bars so I can quickly view stop and target positions (4) and, finally, the only indicators I use are a 21 and 55 exponential moving average but I do like a couple of easy to apply tools namely: my GLEM and a rule. (My GLEM is a modification of a fibonacci retracement tool and the rule, preferably, has to have a mirroring capability).

The above provides everything I need for me to happily trade within my strategies. Anything less is a compromise. I tried most brokers and charts and a great way to do this is to open a demo account, load the charts and try them out. I got to the stage of finding a possible contender and opened a live account. This account provided some great additions over and above. Such as: being able to part exit a trade (i.e. take some profit off without closing out the whole trade); bid/ask lines on the chart; and, the ability to simply change between single and multiple chart screen presentation.

However, after much perseverance I came back to my original broker and charts. I made many fresh tweaks to my layout and technique that were generated from my doing the exercise.

The best fighter I have personally flown would be the F-16. Okay, it’s a single engine fighter and if that engine misses a beat every now and then we could be in trouble, but (operationally) it still beat the socks off everything else – I now feel the same way about my original charts!

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