Be a good Fundie Trader Part 3

Using fundamentals to help give with entries and exits is a valuable tool. In this section I am going to try and explain how I use them to work out where the entry and exit might be. It is really important to note that unless you are trading a time frame of plus 4 hours then dont even waste your time trying to use fundamentals to make trading decisions its a total waste of time on the small time frames as the correlation just does not work.

The first and most important thing to do is read part 1 and 2 of this story as working out the fundamental story whether it be for a day, week, month etc you have to do this first. I read a lot of information with one goal in mind, Which way is the trend going ther is no other reason to plow through fundamentals this is all you are trying to acheive, is to ascertain what is entertaining the minds of the professional money, what's being said in the market that will sway their thinking one way or the other.

So now you are armed with the trend , for a day, week, month etc, now you can open your charting package cause you now have a good handle on the market and what the professional money might be thinking its time to plot support and resistance. I have 4 main things I look for:
1. Is the Support/Resistance visible on 4hour
2. Is the Support/Resistance visible on Daily chart
3. Is the Support/Resistance visible on weekly or monthly chart
4. Fibonacci retracement levels on monthly charts only and extra weight given to the 50% and 61.8% levels

If you have levels that get a tick in all four criteria then the odds start firming that this level will definitely be respected.

I will trade if only one level is met but fundamentally the sentiment is supporting me, but two is pretty solid and you should aim for minimum two and at least 3 fundamental reasons to take a trade.

When looking to get out of trades, it essentially reversing what I have just said, you need look for reasons that the market may be giving you get out such as:

1. Are we reaching critical Support/Resistance
2. Is the sentiment shifting
3. Is there upcoming news that could effect the trade
4. Is the pro money starting to change and move away from your position.

These are the main factors keep it short, keep it simple and be part of the herd and you will succeed.