I wanted to ask the traders that trade with indicators what they think (for their own or other experience) what the most popular indicators are and the periods that they use. The reason for this is I’m trying to create a probability system within my price action trading. I WILL NOT be using indicators to price action trade! I will be finding the trade as normal and then going through a few indicators on a seperate chart that will not be used to monitor the trade to try and work out the chances of the trades winning on pure technical.
For example, MAs: I’ve seen that the 25 ma is fairly good dynamic support and resistane on a lot of major pairs… so after I’ve found my pin bar at a key s/r, I put my 25 period sma on my chart, see that there is also an S/R type line from the 25 sma and decide that the trade is higher probability because of this. I then delete my indicators again and carry on without them.
I know Fibs are also very common but I’m not so sure if any oscilators can be used. Does anyone have any advice on this?
Cheers
Fib
I agree 100%. They are personal depending on your style, experience and makeup. However a friend of mine gave this little nugget of an indicator, when I first started that works no matter who you are, what you are trying to achieve and when you are trying to achieve it. It’s your brain. and the strong basic knowledge you have in it relating to forex trading.
The mistake a lot of traders make when it comes to indicators is they don’t have a strong foundation of basic knowledge and they look for an indicator to take place of basic knowledge. It won’t and never will. For example if you don’t understand what a trend is and the difference between a trend, range or sideways movements, you won’t be able to put the maximum amount of probabilities on your side. When you understand the different ways a currency pair moves, you will be able to pick the best indicator to put the balance of probabilities on your side. Take a MA. Depending on what you’re doing there’s a lot of different ways to set up a MA. Example, simple, exponential, weighted, close, high, low, weighted etc.
So here’s a great exercise in learning about indicators. A trade is made up of a trend,(range or sideways) movement, momentum (strong, even or weak) cycle (up or down), support and resistance (where price as been and where its going)
If you Google Forex MT4 (or whatever trading platform you’re using) Trend Indicators, you will not only be able to find a lot of trend indicators you will also get an explanation of how to use the indicator. Do the same for forex, your trading platform momentum indicators and like wise for cycle, support and resistance you’ll get the same results for each indicator… Keep in mind how you start is not how you will probably finish. As you get better at trading the indicators you use and no longer use will change. While you are doing that another great thing to do is do the same searches and you will find other traders demonstrating how to use the indicators. The only way to put the balance of probabilities on your side, is knowledge. Good Luck
Gp
I agree with what gp00053 says and I would ask you to also watch this short video, paying particular attention to the closing comments about indicators: