Hello and welcome back to today’s post dear beginner trader.
I AM Daniel Ohuegbe, the author and creator of CashForex trading systems.
In today’s post, I will talk to you about technical indicators and how you can choose one out of so many as a financial market trader.
But to begin, we have to define what a technical indicator is, what it is not, and what it can’t do.
TECHNICAL INDICATORS
Technical indicators are vital trader’s tools that help them to carry out technical analysis on Forex and predict further market moves.
Indicators are called technical because they mirror only statistical data of markets.
They do not track fundamental data of trading instruments like companies’ revenue, earnings, and profit margins.
A technical indicator on Forex is based on the value of a trade volume and a price.
By analyzing an indicator’s dynamic, a trader can determine a short-term price direction or a flat market.
Traders, who prefer technical analysis, make decisions using technical indicators on whether to open or close positions.
There Are Several Types Of Technical Indicators
Trend Indicators: Analyze price fluctuations of a trading instrument.
Using trend indicators in trading, it is possible to determine a price direction in various time frames. Moreover, a trader can judge whether a price is trending strongly.
Trend indicators are versatile tools that are beneficial to any trading strategy.
Among trend indicators, there are indicators of trend lines.
Having analyzed previous price patterns, a trader tries to extend a trend line to predict a further price direction. However, such predictions could not come true in practice.
Channel Indicators: are used when trading in price channels.
Such indicators are visual representations of support and resistance in any time frame.
Using channel indicators, you can set a channel width on your own and select the initial data that are needed to plot this indicator.
Oscillators: These are forex indicators that enable traders to earn decent profits in the flat market. Oscillators help determine new lows and highs on a chart, as an oscillator signals when a price will change its direction.
Leading Indicators: Foresee future trends before they come into being in the economy of a particular country.
Using Volatility Indicators, analysts judge a profit-making condition on Forex.
Pure Scalping Indicators: Are rarely used in the market.
A trader has to develop a well-rounded scalping strategy for better trading results.
Using a single scalping indicator is of little help.
A Trade Volume Indicator: This enables a trader to gauge the strength or weakness of a market move as it confirms a trend when a price rises or falls.
A Divergence Indicator: Is a signal that arises in case of disagreement between technical indicators and a price dynamic on the chart. This happens when the indicator does not fix a higher high and a lower low. Any divergence indicator shows a visible price deviation from the indicator’s chart in a trading platform’s window.
CSS Indicator: This is designed to measure the strength of currencies relative to each other. The calculation of exact CSS values is based on technical data that allows traders to respond promptly to any market changes.
To notice signals for a market entry or exit, indicators are applied to price charts and trade volume charts of financial instruments.
Analysis of indicator values brings useful information on a further price direction or even a precise forecast of a future price.
MetaTrader 4 has built-in indicators that trigger almost every basic indicator that is present nowadays.
Working with MetaTrader 4/5 enables you to use any of them or all of them when trading as it pleases you.
Congratulations, as you plan and make every right effort to succeed as a financial market trader.
Based on its beginner friendly and profitable user experience as a trader, here is my recommended technical indicator for you as a beginner today (Band Single Indicator).
Also, to join other beginners in my recommended ongoing 14-day Career Freedom Opportunity, click here.
P.S.: If you have any questions regarding this post, kindly go ahead and comment in the comment section below or share this post with your financial market trader friends using the share button on this post page. Thank you!
I want to see you succeed in life and your financial market trading career.
Talk to you soon,
Daniel Ohuegbe,
14-Day Career Freedom Opportunity Founder And CashForex Trading System Creator!
14-Day Financial Market Success Mentor!
Dedicated To Redeeming Your Career And Financial Freedom!
