Forex Indicators – What Are The Best Forex Indicators?
March 28, 2009 by Kelvin
Filed under Forex Indicator
There are numerous forex indicators
available in the market, so which are the best forex indicators? In fact, there is no such thing as the best forex indicators. All the indicators available are useful depending on how you combine and trade them. There are some traders who are using a certain set of indicators and achieving success while other groups of traders who are also using the same indicators fail miserably.
Therefore you must be able to try out and combine a number of indicators that can make you profit. in this post, I will be sharing with you the forex indicators that I have been using profitable for me.
Basically forex indicators are divided into two main types, namely leading and lagging.
- Leading indicators are those that are able to help you foresee the future price movement so that you can place your limit to exit your trading position.
- Lagging indicators are those that are only able to show you the historical movement of the price giving you a feel of the trend.
In order for you to be able to trade successfully, you must be able to choose a combination of forex indicators that are able to help you to place and exit your trade. Below are my own choice of the best forex indicators that I always used to plan my trades.
Lagging Indicators
- MACD
- Moving Average
- Bollinger Band
Leading Indicators
- Fibonacci
- Pivot Point
Basically I make use of the lagging indicator like moving average to help me identify the current trend so that I can plan my trade to ride the trend. Once I am able to identify the trend, I will then calculate the pivot point to see the current position of the price.
With the pivot point, I am able to forecast the likely movement of the price and this can greatly help me to plan my exit point if I am able to enter a trade. After identifying the exit point, I will go to look for the price setup for me to enter my trade.
If I am planning to trade in the direction of the trend, I will look at the bollinger band and MACD to look for an entry point. If I am planing to trade against the trend or trade the retracement, I will be looking for MACD divergence and reversal candlestick patterns for an entry point.
For any one of the trade above, I will only enter when there is a trendline break. Not having the patience to wait for a trendline break is usually the reason why most traders lose money. This is because if a price did not break a trendline, there is a high chance that it can move against your position. I remember the time when I am new to forex trading and do not have the patience to wait for a trendline break, I always get stop out of my position and then see the price move in my desired direction. (HEARTACHE)
The above are some of the forex indicators and strategies that I am using and hope that it has given you some useful information. So take some time now to find the best forex indicators that can work for you.
If you are looking for forex trading signals that can help you in your trading, I have created a section in this blog for you.
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Hi
Thank you, very nice explanation and useful information.
Glad that you find those information useful to your trade.