Posts Tagged ‘indicator’

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The Awesome Geometry of the Andrews Pitchfork

The Andrews pitchfork indicator is one of the most advanced price action tool in technical analysis. With high accuracy, you can predict reversals. Most technical indicators have lag and have poor scientific substantiation behind them. This indicator respects the complex nature of price. It does not attempt to cover price action in a fixed window of time. Pitchfork indicator respect the length and time duration of the price vectors in a non-linear […]

Why Is It Important to Have Technical Indicators in Our Toolbox?

Traders use technical indicators to predict future price by looking at past price patterns. They are used for analyzing short-term price movements and do not take fundamentals into consideration. Technical indicators help you to identify existing trend and reversals Using too many indicators may cause confusion. Some indicators are suitable for trending market. While some indicators work best in ranging conditions. Indicators are derived […]

Forex Trading — Stochastics — Technical Indicator

The stochastics indicator is a popular technical indicator and was developed by George Lane. It is based on the following observation. Closing price tend to be closer to highs of the price range in an uptrend. If the price closes away from highs, then it indicates that the uptrend is losing strength. When the market is in a downtrend, then the closing prices tend to be closer to lows. When the prices close away from lows, […]

How to Use Moving Averages in Forex Trading

In technical analysis, the experienced traders say that, the trend is your friend. Hence, it is important that you must first ascertain the existing trend of an asset or a currency pair. An uptrend is made of higher highs and higher lows. A downtrend is made of lower highs and lows. How do you determine an existing trend? You can add the moving average indicator on your MT4 platform, which is available […]

How to Use the Relative Strength Index (RSI)

The RSI is a momentum indicator used to measure the momentum of an asset. It is s popular indicator used frequently in technical analysis. It can be compared to an oscillator and it fluctuates between two levels. It is used to measure the overbought and oversold readings for an asset. Prices above the 70 level is considered overbought. Prices below the 30 level is considered oversold. For example, you can enter a long position […]

How to Use Bollinger Bands?

Bollinger Bands is an important indicator in technical analysis, which is used to identify trends and measure volatility in the markets. This indicator was developed by John Bollinger, and it consists of a moving average and two bands, which are obtained using standard deviation of the moving average. Because 95% of the historical price movements are contained within the bands, you can get valuable information like when the price is overextended or likely to reverse. […]

Do RSI Overbought/Oversold Strategies Work?

In this video, you will learn about the other side of technical analysis, which shows you the more precise way of seeing the markets. A commonly used strategy involving the RSI indicator for observing overbought and oversold conditions. Above 70, the market is considered overbought. Below 30, the market is considered oversold. However, there exists a fundamental flaw with this approach. For example, look at this chart. You have the RSI […]

Does the Bollinger Bands Indicator Work?

In this video, you will learn about a strategy of analyzing the usage of Bollinger Bands indicator in relation to Andrew's pitchfork. In this example, you have the Bollinger Bands indicator added to the price chart. In some cases, the price touches the upper band as it has reached those extreme points, and then reversed. Now, you can see the problem with this indicator. There are situations when the price touches the upper band, […]

Do MACD Crossover Strategies Work?

In this video, you will learn about finding entries and exits using a better way, than using technical indicators like Bollinger Bands, MACD, etc. For example, look at this chart. The MACD indicators is shown below the price. When the price goes up, the histogram turns green. When the price goes down, the histogram turns red. You can use the green histogram bars for buy signal and the red histogram […]

How to Use MACD Indicator in Forex Trading

The MACD is a popular indicator in technical analysis. It stands for moving average convergence divergence and is used to find the momentum and the direction of the market. The MACD indicator can be used as an indicator for generating buy or sell signals using the crossover. It can also be a confirmation indicator, if you already have a technical setup. You can also use the histogram bars of the MACD indicator. The green bars indicate bullish momentum […]