General Help with strategy guys
- Thread starter Popsta
- Start date
Rufino Fiorentini
Member
Indicator might help you make strategy or guess market movement, but please do not depend on it completely as those are actually one kind of robot. First you need to gather fundamental knowledge. You can start with scalping trading or simple support resistant breakout trading as starter. If you are totally new you can take help of broker like Eurotrader. I trade with this broker. It has good education system for new traders like you.
Since you're just getting started, you should seek the most effective and simple strategies for identifying trades and stick with that approach. Do not overcomplicate the trading because you will get only confused and will earn no profit.
One way to simplify your trading is through a trading plan that includes chart indicators and a few rules as to how you should use those indicators. In keeping with the idea that simple is best, there are four easy indicators you should become familiar with using one or two at a time to identify trading entry and exit points:
Using forex indicators to read charts for different market environments
There are many fundamental factors when determining the value of a currency relative to another currency. Many traders opt to look at the charts as a simplified way to identify trading opportunities - using forex indicators to do so.
When looking at the charts, you'll notice two common market environments. The two environments are either ranging markets with a strong level of support and resistance , or floor and ceiling that price isn't breaking through, or a trending market where the price is steadily moving higher or lower.
Using technical analysis allows you as a trader to identify range bound or trending environments and then find higher probability entries or exits based on their readings. Reading the indicators is as simple as putting them on the chart.
Trading with moving averages
One of the best forex indicators for any strategy is moving average. Moving averages make it easier for traders to locate trading opportunities in the direction of the overall trend. When the market is trending up, you can use the moving average or multiple moving averages to identify the trend and the right time to buy or sell.
The moving average is a plotted line that simply measures the average price of a currency pair over a specific period of time, like the last 200 days or year of price action to understand the overall direction.
You'll notice a trade idea was generated above only by adding a few moving averages to the chart. Identifying trade opportunities with moving averages allows you to see and trade-off of momentum by entering when the currency pair moves in the direction of the moving average and exiting when it begins to move opposite.
Trading with RSI
The Relative Strength Index or RSI is an oscillator that is simple and helpful in its application. Oscillators like the RSI help you determine when a currency is overbought or oversold, so a reversal is likely. For those who like to 'buy low and sell high', the RSI may be the right indicator for you.
The RSI can be used equally well in trending or ranging markets to locate better entry and exit prices. When markets have no clear direction and are ranging, you can take either buy or sell signals. When markets are trending, it becomes more obvious which direction to trade (one benefit of trend trading ) and you only want to enter in the direction of the trend when the indicator is recovering from extremes.
Because the RSI is an oscillator, it is plotted with values between 0 and 100. The value of 100 is considered overbought and a reversal to the downside is likely whereas the value of 0 is considered oversold and a reversal to the upside is commonplace. If an uptrend has been discovered, you would want to identify the RSI reversing from readings below 30 or oversold before entering back in the direction of the trend.
Trading with stochastics
Slow stochastics are an oscillator like the RSI that can help you locate overbought or oversold environments, likely making a reversal in price. The unique aspect of trading with the stochastic indicator is the two lines, %K and %D line to signal our entry.
Because the oscillator has the same overbought or oversold readings, you simply look for the %K line to cross above the %D line through the 20 levels to identify a solid buy signal in the direction of the trend.
Trading with the Moving Average Convergence & Divergence (MACD)
Sometimes known as the king of oscillators, the MACD can be used well in trending or ranging markets due to its use of moving averages provide a visual display of changes in momentum.
After you've identified the market environment as either ranging or trading, there are two things you want to look for to derive signals from this indicator. First, you want to recognize the lines in relation to the zero lines which identify an upward or downward bias of the currency pair. Second, you want to identify a crossover or cross under the MACD line (Red) to the Signal line (Blue) for a buy or sell trade, respectively.
Like all indicators, the MACD is best coupled with an identified trend or range-bound market. Once you've identified the trend, it is best to take crossovers of the MACD line in the direction of the trend. When you've entered the trade, you can set stops below the recent price extreme before the crossover, and set a trade limit at twice the amount you're risking.
Hope this helps
One way to simplify your trading is through a trading plan that includes chart indicators and a few rules as to how you should use those indicators. In keeping with the idea that simple is best, there are four easy indicators you should become familiar with using one or two at a time to identify trading entry and exit points:
- MACD (Moving Average Convergence & Divergence)
- Moving average
- RSI (Relative Strength Index)
- Slow stochastic
Using forex indicators to read charts for different market environments
There are many fundamental factors when determining the value of a currency relative to another currency. Many traders opt to look at the charts as a simplified way to identify trading opportunities - using forex indicators to do so.
When looking at the charts, you'll notice two common market environments. The two environments are either ranging markets with a strong level of support and resistance , or floor and ceiling that price isn't breaking through, or a trending market where the price is steadily moving higher or lower.
Using technical analysis allows you as a trader to identify range bound or trending environments and then find higher probability entries or exits based on their readings. Reading the indicators is as simple as putting them on the chart.
Trading with moving averages
One of the best forex indicators for any strategy is moving average. Moving averages make it easier for traders to locate trading opportunities in the direction of the overall trend. When the market is trending up, you can use the moving average or multiple moving averages to identify the trend and the right time to buy or sell.
The moving average is a plotted line that simply measures the average price of a currency pair over a specific period of time, like the last 200 days or year of price action to understand the overall direction.
You'll notice a trade idea was generated above only by adding a few moving averages to the chart. Identifying trade opportunities with moving averages allows you to see and trade-off of momentum by entering when the currency pair moves in the direction of the moving average and exiting when it begins to move opposite.
Trading with RSI
The Relative Strength Index or RSI is an oscillator that is simple and helpful in its application. Oscillators like the RSI help you determine when a currency is overbought or oversold, so a reversal is likely. For those who like to 'buy low and sell high', the RSI may be the right indicator for you.
The RSI can be used equally well in trending or ranging markets to locate better entry and exit prices. When markets have no clear direction and are ranging, you can take either buy or sell signals. When markets are trending, it becomes more obvious which direction to trade (one benefit of trend trading ) and you only want to enter in the direction of the trend when the indicator is recovering from extremes.
Because the RSI is an oscillator, it is plotted with values between 0 and 100. The value of 100 is considered overbought and a reversal to the downside is likely whereas the value of 0 is considered oversold and a reversal to the upside is commonplace. If an uptrend has been discovered, you would want to identify the RSI reversing from readings below 30 or oversold before entering back in the direction of the trend.
Trading with stochastics
Slow stochastics are an oscillator like the RSI that can help you locate overbought or oversold environments, likely making a reversal in price. The unique aspect of trading with the stochastic indicator is the two lines, %K and %D line to signal our entry.
Because the oscillator has the same overbought or oversold readings, you simply look for the %K line to cross above the %D line through the 20 levels to identify a solid buy signal in the direction of the trend.
Trading with the Moving Average Convergence & Divergence (MACD)
Sometimes known as the king of oscillators, the MACD can be used well in trending or ranging markets due to its use of moving averages provide a visual display of changes in momentum.
After you've identified the market environment as either ranging or trading, there are two things you want to look for to derive signals from this indicator. First, you want to recognize the lines in relation to the zero lines which identify an upward or downward bias of the currency pair. Second, you want to identify a crossover or cross under the MACD line (Red) to the Signal line (Blue) for a buy or sell trade, respectively.
Like all indicators, the MACD is best coupled with an identified trend or range-bound market. Once you've identified the trend, it is best to take crossovers of the MACD line in the direction of the trend. When you've entered the trade, you can set stops below the recent price extreme before the crossover, and set a trade limit at twice the amount you're risking.
Hope this helps
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