Technical planning , learning and analysis is not only reading the forex charts. Charts are part of the analysis operation, but price trend in the market is just a case among many cases. Technical indicators or studies enable us to know the price movement in a certain period of time. They indicate whether the trend is strong or it might fall into reverse. They can even predict the next price move of a pair.
Every forex trader may choose his desired indicator. But most professional traders concider that there are three indicators that every forex learner must use:
1. Moving Average Lines
Moving average lines are very important indicators that make us know what is the trend looks like. It helps us to know whether it is bullish, bearish, or nonexistent. It shows two levels, support and resistence. At the support level, the price is about to move higher when, at the resistance level, the price is likely to start falling.
2. Bollinger Bands
Bollinger Bandsare trading bands that are placed around a currency price and the 20-period moving average line. They let us whether a currency of pair is trending and the points at which a price trend may reverse. Bollinger Bands are very important for showing support and resistance along with the level of volatility in the market. Support is more likely happened at the lower Bollinger Band while resistance can be found at the higher Bollinger Band.
3. Average Directional Index (ADX)
This indicator also can be used with both moving average lines and Bollinger Bands. The ADX shows the strength of the move the price. And that shows how long a trend may survive, it is likely to continue moving positively. If it is weak, it is likely to reverse. Traders have different . The ADX level that is below 10 shows that the pair is weak and trending negatively . An ADX level above 30 shows somehow strong trend. An ADX above 40 indicates a highly strong trend.
Beginners may face a lot of indicators to choose from. I advise to use the above mentioned indicators, along with the candlesticks, and happy earning to all.
Every forex trader may choose his desired indicator. But most professional traders concider that there are three indicators that every forex learner must use:
1. Moving Average Lines
Moving average lines are very important indicators that make us know what is the trend looks like. It helps us to know whether it is bullish, bearish, or nonexistent. It shows two levels, support and resistence. At the support level, the price is about to move higher when, at the resistance level, the price is likely to start falling.
2. Bollinger Bands
Bollinger Bandsare trading bands that are placed around a currency price and the 20-period moving average line. They let us whether a currency of pair is trending and the points at which a price trend may reverse. Bollinger Bands are very important for showing support and resistance along with the level of volatility in the market. Support is more likely happened at the lower Bollinger Band while resistance can be found at the higher Bollinger Band.
3. Average Directional Index (ADX)
This indicator also can be used with both moving average lines and Bollinger Bands. The ADX shows the strength of the move the price. And that shows how long a trend may survive, it is likely to continue moving positively. If it is weak, it is likely to reverse. Traders have different . The ADX level that is below 10 shows that the pair is weak and trending negatively . An ADX level above 30 shows somehow strong trend. An ADX above 40 indicates a highly strong trend.
Beginners may face a lot of indicators to choose from. I advise to use the above mentioned indicators, along with the candlesticks, and happy earning to all.