False signals are part of trading, but if you can act upon them the right way and with professionalism, you can, for sure, make the difference in your trading style and perception.
By being able to interpret the adverse signals you will then be able to take your trading activity to the next level especially when it comes to discipline and consistency.
False signals are of vital importance
The importance of this identification goes deeper into three areas:
- In the scenario where you have identified a false signal, you can either perform the opposite order to this signal or not trade at all
- Wait for other opportunities, the signals in other words which you believe are true
- If you are using an EA, you can have this software script on a demo account, for identifying the true and false signals, but execute your live orders on a real account