Do charting tools like moving averages, parabolic sar, Bollinger bands, etc. show up on the chart before price does, thus predicting what may happen? Or do they show up at the same time price does?
Interesting question bro , I have the same doubt
Indicators are based on price. They can’t print a value that is based on prices that have not occurred yet.
Some people find that indicators give advanced warning that price is going to go up or down, before this is seen on the price chart. However, these things are not 100% accurate - its like seeing clouds outside and wanting to know if it will be raining within the next 30 minutes - it might rain, it might not rain.
In any case, indicators do not predict price. They can be used to help a trader be ready for what price might do. So if you see clouds you might take an umbrella: if you don’t see clouds you probably will not. In both cases you could be right, you could be wrong.
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indicators are HISTORICAL . . As the saying goes, “past performance is not indicative of future”.
Having said so, one way they may complement your forex trading is to make chart reading easier for you.
Another theory is that because many trade with the input of these indicators, it can possibly become a “self fulfilling” prediction.
@tommor did a great job using the example of seeing clouds and hence take an umbrella as a preparation.
Forex goes beyond just looking at indicators. You need to consider sentiment, undertones, correlation etc etc
May the pips be with you!
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Thanks for your reply
Technical indicators are mathematical calculations based on the price so by definition, the price has to show up first.
Thank you for the answer!