In Forex, indicators and oscillators are two tools to separate. In this article we will talk exclusively about forex trading indicators and their uses. Trend indicators are used to have reliable signals based on difficult mathematical calculations which, combined with technical analysis, provide the right entry points into the market to maximize a trader’s profit. We know that in the world of trading a few pips can make the difference between a successful operation and a failed operation, the indicators come to our aid and reassure us about the reliability of our decisions! Trend reversal indicators are not all the same. The goal is always to predict price trends, but they achieve it in a totally different way. We must in fact distinguish between trend, movement and volatility indicators. I will give you short examples for each type and in the next articles I will take these indicators one by one and teach you how to set them correctly! There are no better forex indicators than others, I depend on how we use them and how we set them up. Motion indicators are the most used. Among them we find the Moving Average. The Moving Average ranks right in the top of the best forex indicators, this is not because it brings greater profits. As I said earlier, there are no indicators that are better than others, but the moving average is the first tool used by every trader. This indicator is based on an average of the closing prices of the last “n” periods and is often used as a support and resistance indicator mt4 (Metatrader 4). Among the best intraday trading indicators we also find the MACD, used by many traders to anticipate changes in price trends. Finally, it is impossible not to mention ADX as a trend indicator, the latter analyzes the strength of the current trend.
Among the movement indicators we can find two of the best forex mt4 indicators: RSI and Stochastic. RSI is a very popular indicator for indicating in which stages the price is “oversold” or “overbought”. Stochastic is always an indicator used to find oversold and overbought areas, but it is formed by a scale from 0 to 100 where a price in the area above 80 indicates an excess of buy, in the area below 20 an excess of sell.