Choosing the Best Colour Scheme for Your Trading Charts
Colour choices on trading charts can influence our mood and decision-making. Traditional green and red candles can cause biases, so experimenting with alternative colours can promote objectivity. A thoughtfully coloured workspace can support a focused trading environment, and improve your performance.
Why Colour Matters in Trading
When you’re analysing the charts, how often do you consider the colours on your screen?
Most of us default to the typical chart setup: a black or white background, with green and red candles signalling price movements, green for upward, red for downward. But have you ever thought about how these colours might subtly affect your trading decisions?
Colours evoke specific feelings, as our brains associate certain hues with particular emotions. Studies have shown that these associations influence our decision-making.
Consider the common green and red scheme. Green is widely associated with growth and positivity, while red can signify caution or danger. These subconscious cues may affect how you perceive market moves.
Without realising it, you might feel more positive toward a trade simply because it’s represented by a green candle, or more cautious when you see red, even before you fully process your analysis. This psychological effect could subtly influence your trading biases, perhaps even leading you to favour trades in one direction over another.
Given these potential effects, exploring alternative colour schemes may benefit your trading performance. Some traders switch to colours like yellow and purple, or even opt for black and white or grayscale setups. By using different colours, you may prevent emotional associations from impacting your decision-making. Changing your chart colours periodically, such as every quarter, can help keep you from developing unconscious biases toward certain movements.
In balanced markets like forex, where trades are given equal weighting regardless of direction, avoiding colour-coded signals for buys and sells can be particularly helpful. With a neutral colour scheme, you can approach each opportunity objectively, without added subconscious influence from the colours on your screen.
Creating an Optimal Trading Environment
The colours influencing your trading aren’t limited to your charts. Your overall environment, your workspace and even your clothes, can affect your mindset and mood.
This might seem trivial, but everything in your workspace has the potential to impact your emotions, and by extension, your performance. Traders striving for marginal gains often focus on refining their strategies and systems, but even minor adjustments in their environment, like colour, can contribute to their results. A small boost of even 1% can have a noticeable effect on profitability over time.
Personalising Colour for Optimal Performance
Although there’s no definitive science tying every colour to a specific emotion, there are generally accepted psychological associations. However, responses to colour are complex and can vary from person to person.
Some researchers argue that while colours can trigger feelings, individual reactions are hard to quantify. Nonetheless, understanding the general emotional responses associated with certain colours can help you make choices about your trading environment.
Ultimately, you’ll want to understand your unique emotional responses to colour. Aim to surround yourself with colours that promote positive emotions, while reducing exposure to hues that might provoke stress or distraction. On your trading charts, colour can be used strategically to emphasise specific elements, like using bold colours to draw attention to important areas or softer tones for less critical information.
When choosing colours, remember that less is more. Using too many colours can create visual clutter and confusion. Consider what aspects of the chart you need to focus on and choose colours that will support, not overwhelm, your analysis.
The colours you choose for your trading charts and workspace are more than just aesthetic choices. They influence your perceptions, your emotions, and ultimately, your trading performance.
Taking time to experiment with different colour schemes can help you find an approach that minimises emotional triggers and optimises focus. By being intentional with colour, you can create an environment that supports clear thinking and confident trading decisions.