What is forex indicator, how does it works?

[Somrat4030]

What is forex indicator?​

When traders talk about "forex indicators," 99% of the time they're talking about technical indicators in the context of currency trading.

Basically, technical indicators are computerized calculations used to forecast price changes in financial markets. They can be applied to any chart, including those of currencies.

The calculations are based on past market prices and sometimes volume. Because currency trading is decentralized, meaning there's no central exchange that would record all transactions, volume data is not accurate.

How does forex indicator works?​

Sorry to burst your bubble, but an indicator is nothing more than a different way of looking at the same information. Still, if you master technical analysis by using the right forex indicators, trading can be much easier for you. So, how do you actually use these forex indicators as a trading tool in forex trading? And, how can you find the best forex indicators for you?

Indicators are ideal for rule-based trading​

Indicators take out the guesswork by providing information that is totally objective. Especially new traders or traders who are struggling with discipline can benefit from that.

If you are a trend trader, for example, you can use indicators as filters. You might have a rule that says that you can only look for long trading opportunities on the lower timeframe when price on the higher timeframe is above a certain moving average and when the RSI is rising, or when the Stochastics are pointing upwards. Using higher timeframe filters by using indicator based rules often work wonders for new traders.

Of course, there are many other possible use cases but the idea is always the same: pick an indicator that supports your trading style and your objectives, then use it as a filter and wait for additional criteria. Moreover, You can join a forex forum for learn more about forex reliable indicators.

You can learn more about forex trading core spreads review.

 

[Kingstone]

There are many indicators in the market to choose from. Without trading tools, trading will be nothing other than a wild goose chase; a gambling game to the core. Even with these tools, most people do consider it gambling as you predict when the market will rise or fall to make profits. I have used many technical indicators in the past few months. I have used Relative Strength Index (RSI), Moving Averages, MAXD, ADX, and many others. Still, none of them is without a loop. Some will give you a false signal by predicting the market before the price action. If you follow that, you might end in losses if the market does not follow up quickly in that direction. Some may give you signals that have happened and this is extremely bad for you. You can master your indicators and how to use them with a demo account before going live.

 

[Victorial]

Without these indicators, it will be difficult to place a trade. But as a good trader, you do not have to rely filly on these indicators as no indicator is without a glitch. All of them have where they do not cover and thus can result in your downfall. That is why my mentor does not fully trust these indicators. He did not have any indicator set up on his chart other than the moving averages. These moving averages are used to know where you enter and exit a trade. My mentor relies on candlestick patterns to place his trades and I am learning how to understand them much better

 

[btaliat]

The first thing s good mentor will train a trader with is how to use indicators. These indicators will let the traders know how to place a trade. A trader that doesn't use indicators while trading is nothing but a punter who is only trading based on emotion and not on analytical skills that trade should be based. There are some that believe in using doji candle pattern to know when to initiate a trade and when to exit s trade while some believe in fundamental analysis which is listening to news and market trending before trading.

 

[Dita Walczak]

An indicator is a signal. With the help of which one can enter trading. This indicator is provided free of charge for some successful broker strategies. For example, I work for a Eurotrader broker. This broker gives me many indicators for free.

 

[Setho]

Forex technical indicators are usually tools that used data from the current market statistics and also pass statistics to be able to give you an insight into what is happening or what could potentially happen. They are usually divided into technical indicators that can show you a trend that is already in motion or a trend that is likely to happen in the near future. This does not in any way mean that they are predicting the market and that is why it is advisable to use more than one technical indicator in order to ascertain and entry trigger compatible.

 

[Ivo Zetticci]

Swing trading has become more popular among traders. Here, trades last more than scalping. It distributes more profit than scalping. With FXOpulence broker, you can place the TP and SL at the right positions and you can experience fast execution of them with the broker.