8 Technical Indicators Which Would Help You For Trading

Stochastic: 

  • Range indicator to spot reversal
  • Speed of price movement
  • Measures price momentum

+ Widening stochastic shows strength of price, A narrowing and closing Stochastic signals slowing momentum in the trend


RSI

  • Trend strength indicator
  • Compares bullish and bearish candles
  • Measures strength and momentum

+ When RSI is high, it means that there were more past bullish cnadles and they were larger in size, a low RSI signals that past price action was bearish


ADX

  • Signals strength and Weakness
  • Less than 25 range or weak trend
  • More than 50 range or Strong trend
  • 25-50 Modest trend

+ The ADX indicator can be used to differentiate between trend and range conditions


MACD

  • Trend following and momentum indicator
  • High MACD shows a strong uptrend. A low MACD signals a strong downtrend.
  • A Crossover of the MACD lines can signal a long or short setup 

+ The MACD is effective during trends and should be used when the ADX is signaling a trend scenario


MOVING AVERAGES

  • Multi function tool for different purposes
  • The site of which price is on can signal direction for trades
  • The slop of the MA shows strength of trends
  • The direction of the MA signals trend or range conditions

+ MAs function as support and resistance levels

BOLLINGER BANDS

  • BB are mainly used for volatility measures
  • The width of the BB shows current volatility
  • If price can stay outside the BB, it shows trend strength

+ Price reaching the outer band can also signal a reversal when price is over extended


ATR

  • ATR is a volatility and price range tool
  • ATR measures the size of past candle

+ Can be used to adjust stop and profit placement based on volatility


DIVERGENCES

  • Divergences provide information about what is going on inside price
  • Signals that what you see on your charts is not reflected in price
  • Can show slowing momentum and weaknesses in trends

+ Often used to identifying turning points or time trade exists


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