Why traders need to look at the big picture

It's all too easy for swing traders to get bogged down in short-term details. John C Burford explains why it pays to keep an eye on the longer term charts.

As swing traders, we generally focus on the short-term charts. This is where we find clues as to a good trade entry and the next direction of the market.

There is nothing wrong with this approach, since we are typically dealing with moves of tens of pips. Also, we are using protective stops of a similar magnitude. These swings show up very well on the hourly chart.

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John is is a British-born lapsed PhD physicist, who previously worked for Nasa on the Mars exploration team. He is a former commodity trading advisor with the US Commodities Futures Trading Commission, and worked in a boutique futures house in California in the 1980s.

 

He was a partner in one of the first futures newsletter advisory services, based in Washington DC, specialising in pork bellies and currencies. John is primarily a chart-reading trader, having cut his trading teeth in the days before PCs.

 

As well as his work in the financial world, he has launched, run and sold several 'real' businesses producing 'real' products.