A brief detailed about the most widely used indicators

by Andrew

The Forex market is one the best source of income in today ’s world. If you know the perfect way to trade the market then you can easily make a huge amount of money simply by trading the live asset. But mastering the art of Forex trading is not as simple as it requires extensive practice and clear knowledge about the financial industry. In Australia, Forex trading is often considered to be the best alternative source of income. Many professional Aussie traders are now living their dream life simply by trading the live asset. But to place quality trades in the online market you need to have a solid trading system which will take care of your profit factors. This is where the term indicators come into action. Staring from the novice traders ending with the professional, every single one of the use indicators in their trading. Unlike the novice traders, the expert never uses more than two indicators in their trading chart. So let’s learn about the most popular indicators in today’s world.

The 100 day SMA

This 100 SMA is often known as the 100-period simple moving average. The professional traders use it to find the dynamic support and resistance level of the market. If you are new to this market then trading with dynamic support and resistance level will be extremely easy for you. You don ’t need to find the key support and resistance level using the horizontal lines. All you need to do is to place your indicators and you are all set. This also allows the traders to find the existing trend of the market. If the price trades above the 100 days SMA it is considered to be bullish trend and when it ’s below, we call the market trend as bearish. Some expert traders often use pending orders to scalp the market using dynamic support and resistance level. But if you are new to this market it's better for you to learn its use in demo account.

The RSI indicators

The RSI indicators are very much popular in the options trading industry. It allows the traders to find the overbought and oversold condition of the currency pairs. Most of the novice traders use in the lower time frame which is totally wrong. If you want to get the best readings of the RSI indicators then you need to trade it in the higher time frame. Most of the professional traders use it on the daily time frame. Sometimes the expert uses the double RSI trading strategy to get a clear idea about the reversal zone of the currency pair. But before you use the RSI indicator make sure that you test in demo account.

The Bollinger band indicators

The Bollinger band indicator is one of the favorite tools for the professional range traders. Most of the time the price goes up after hitting the support level of the Bollinger band. And when it hit the upper band the price falls down. Basically, it creates a channel for the traders. But instead placing random buy and sell orders using this indicator you need to use the price action confirmation signal. Many professional traders are making tons of money simply by using this indicators and price action pattern. But when you trade the market you need to make sure that you are always trading in favor of the market trend. Though this system is highly profitable yet should never risk more than 2 percent of account capital regardless of the quality of the trade setup.

Summary: By now all you know about the most popular indicators in the Forex market. If you can master the use of these indicators then you can easily improve your trading performance to a great extent. But always consider the indicators as your helping tools and try to keep your trading chart clean.

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