In order to analyze the financial asset, each trader has a set of effective trading tools that allow you to search for the most profitable moment of entering the market, as well as to exit from it. This toolkit can consist of anything: from levels up to analysis of fundamental data. Every fix api trader should know about each of them, but choose only one.
Today, I suggest that you familiarize yourself with one of the most popular trading methods of market analysis, which is based on technical indicators, namely trend ones.
We all know the good old saying “the trend is your friend”. But how to determine in which phase is the market currently? The search for an answer to this question aims at finding the end of the trend and enter at its very beginning. The definition of local extremes on the graph, the Elliott wave theory, and of course, the trend indicators can help you in this.
Trend indicators are a group of technical elements for market analysis that are based on the immediate determination of the current quotes relative to their historical movement in order to compare current values with past data. This approach shows you how exactly this or that situation developed for this particular financial asset and allows you to open a deal when certain signals are reached.
As we understand, the trend indicators indicate the fact of confirmation of the formed movement. But what signals can they bring to us? After all, if you trade based on fact, you lose a significant portion of the probable profit on the fix api forex market.
For this, there are additional elements that can be treated as a signal to change the trend. Thus, I single out 3 possible trading signals that can be obtained with technical trend indicators:
- Crossing the lines of indicators. In order to use this trading signal, you must use two different indicators or the same one, but at different time intervals. For example, if you are trading with the Moving Average (http://www.investopedia.com/terms/m/movingaverage.asp ), which has a period of 20, add this technical indicator with a period of 50. Then, when the line with MA 20 will cross the MA 50 line from top to bottom, this will indicate a trading signal to sales, as there is a decline in asset value and dynamics with high probability may continue further. If you use the same indicator, several lines are already laid in technical tools like Ichimoku cloud or ADX, which are also able to intersect and demonstrate the signal to the fix api trader.
- Crossing the quotes of the technical indicator line, namely Moving Average. This signal works analogically to the previous one. But the only difference is that the signal is taken into account not at the intersection of the indicator lines, but directly at the asset price. Moving Average technical indicator is often used to search for this signal. If quotes cross MA from the bottom to the top and are fixed above the line, then this indicates to a new direction of the trend.
- Direction of the technical indicator value. You can also take into account the direct value of the indicator and its dynamics. Personally, I use this method. When the value of Ichimoku or the same MA grows, it is a signal to the fact that a trend is formed in the market. And even there may be a situation in which the quotes have broken through the value of the indicator, and it is growing. In this case, I interpret this fact as a false breakdown. But if there was a breakdown and the MA value began to demonstrate the reverse dynamics, then this is a signal to the opening of trading positions.
These trading signals (https://1sforexsignals.com/ ) are widely used by most traders in the fix api forex foreign exchange market and I hope that you were able to emphasize useful points for yourself.