Please, I am using a trend following strategy. I have discovered that one weakness I have is determining when trading whether a trend is gaining strength or beginning to get weak from a strong point. Can someone recommend an indicator that can indicate this to me. It would greatly increase my trading effectiveness.
Thanks
the RSI index lets you know when price is oversold or overbought at certain levels, so maybe test that out and see if it works for you
What setting do I use for the RSI? I am trying out a scalping strategy.
You can keep the standard setting, I believe >70 is overbought , & <30 is oversold. You can change them, but doesn’t really make much sense to do that.
Momentum or volume based indicators will do this for you. Also look at the candlesticks, the high-low range will get shorter as it slows down, the rate at which new highs/lows are put in will get closer as well.
What I was taught is to use 2 or 3 different indicator types. Primary generates your entry signals, 2nd confirms or rejects the signal, 3rd acts as your exit signals or some sort of backup to warn you of potential issues like divergence.
Trend (moving averages, MACD, ADX, Parabolic SAR)
Momentum/Oscillators (RSI, Stochastic, MOM) [MACD could arguably fit here too…I’m not a fan]
Volume (OBV, CMF)
Volatility (VIX, Bolinger Bands, ATR)
Pick one from each category and mix/match with other categories until you find the combo you like. Avoid using 2 similar indicator types as this will cause conflicting signals and confusion. Also play around with adjusting the settings. Sometimes the default just doesn’t work that great anymore as most of these are easily 20 years old, or older, and the market moves too fast for them to be effective out-of-the-box.
My personal fav combos:
OBV with a 100 EMA applied to the OBV. Long when OBV crosses above the ema, short when it crosses under.
Hull’s MA 50 and a stochastic that shows divergence. Enter trade when candles close under/over the moving average. Use the stochastic to spot divergence for reversals and as a midline/zero cross for trend confirmation. You don’t always want to bail on a MA cross, it happens in consolidation.
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Here’s an old indicator setup I used for trend trading, something similar could be used for scalping.
Stochastic is changed to 50, 6, 12 setting so now it’s reading longer momentum for swings and not a short window. I also change it to a 50-cross indicator.
OBV is set to either HL2 or OHLC4 for full price trend reading
100 EMA applied to the OBV so it’s giving us the OBV trend
Ignore the 50 HMA on the candlesticks, I’m actually working this trade with a different setup i’m testing. 
Enter trade with trend when the Stoch cross the 50 and the OBV is in a favorable position in relationship to the Stoch’s cross. Meaning long if stoch crosses up and OBV is above the ema, short if the setup is opposite. Stop is set 50 pips below prior month’s low and target is at prior month’s high. You could adapt this to prior week, day, or hour/4h/8h/12h period if you’re scalping.
Close when stoch crosses 50 line counter-trend and re-enter when it crosses with trend, or stay with the trade if the OBV says to stay long/short.
There’s also many other ways to trade this indicator set. You could use just the OBV cross to trade and use the stock for divergence warning when the trend is weakening (reduce position or take profit), or use the stock signals to pyramid positions. You could shorten the period and trade crosses of the stock %K and %D but only in the direction of the OBV’s trend indication. (enter longs, close on short indication in this case)