These indicators are all designed to predict what a market will do. You can discount all indicators designed to predict a market move. They are not, by themselves, a predictive trading system. Technical indicators are only useful as part of a complete reactive trading system.
The only true method for trading is a long term trend following system that reacts to the market. Moreover, by itself, a technical indicator is meaningless. My understanding of trend following is that if you want to make money, buy low and sell high. Sounds simple. The trick is to identify entry and exit positions and there is a host of guys out there promising that their particular system will solve all your needs.
Why do you feel entry and exit is the crucial issue in trading? Good traders buy higher and sell lower all along, focusing on how much money they are making or losing not just winning percentages. Buying higher means that as a trend moves up you buy more as the price increases. Would you only want to buy at a price of 5 or 6 or 7?
Of course not. Depending on your system, you might buy at 20 or 30 or even higher. Not sure what we mean? Email and ask! If the trend goes to , how do you know it in advance? The point is to ask yourself, when do you buy? At price levels of 5, 6 or 7? At 20 or 30? Buying more as the trend progresses is what we mean by buying higher highs.
Trying to buy low is nonsense. Are you promoting an alternative way of identifying the trend plus a money management system? The key is not where you enter and whether you have a profit or loss on a position. The key is how big must you be trading based on market volatility. That must be your concern. So you should be trading smaller.
Lose the concept that where you enter is critical. What is relevant is your current position, your equity and where the market is now. But, focus on where real trading success comes from: money management. That was his strategy. Sounds reasonable. But as trend followers know, this type of strategy is prone to problems. The biggest problem being that it goes against the math of getting rich. He is not letting his profits run! When you trade as a trend follower, your objective is to stay in a position forever.
Of course, you have a plan for exiting long before you enter the trade, but the idea is to follow the trend as far as it will go up. Many people use the jargon terms support and resistance. The words are used to describe perceived tops and bottoms in a market. Unfortunately, support and resistance is a waste of time. A trader should learn more than just default settings of an indicator. Only default settings do not work always. Working with a broker, I began to actually use fewer indicators.
As for me, this is a very convenient option for work. Useful, definitely. But it should also be understood that they may not always be accurate. To do this, you must first check them on a demo account. I don't find them useful but others do. Have to find what helps you to see what you need to see in order to trade. What people 'think' doesn't matter. If you can't spot the liquidity then you are the liquidity. Helpful, but not always. Rather, it depends on the source of the indicators.
Most people do not fully understand how to use the tools they have in their hands. They use it for the wrong reason. Indicators are not useless. However, if you look at it as a helping hand then you can get a lot out of it. Forex indicators are indeed helpful but to master the understanding of all indicators, it takes years. You need to pick a few and try to validate your understanding with real trades.
Indicators are very important process when it comes learning and understanding forex trading. Definitely, indicators are very useful for work. The only question is the accuracy of the indicators themselves. Nutty32 posted: No more indicators. They don' work. I am a price action trader. I do not use indicators. However, I do not think indicators are useless. There are traders using indicators and making money by trading.
It may need hours of practice to be able to use an indicator accordingly. Just no perfect indicator exists, the indicator only as help tool created by expert and experienced trader, a trader needs to learn how to use the indicator and its function, besides to use indicator also important to keep plan trading work with risk management plan, here most trader use stop loss or trailing stop feature, some trader using hedging position etc Open in a full screen.
Why do you think the indicator is the solution to all trading problems? In fact, you can use any indicator successfully, but get a loss due to the lack of a trading plan or incorrect volatility assessment Indicators should be used in chain with other technical instruments, and then the consistency of several data sources will signal the possibility of a trade.
In fact, indicators are a really useful addition. But it is also important to understand the processes that are taking place on the market yourself. Indicators are always lagging on what has done, you need to definitely have knowledge of market structure and price action to give you a clearer image of what's happening Open in a full screen.
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|Non investing integrator operational amplifier trainer||And that, my friend, is where fibonacci comes in, in particular, the Roman says How would you realize pure price action trading for day trading where you act on a 15 Min chart or below if not using indicators to give you an signal especially when to take action while not wasting your time watching slow moving forex pairs not moving much for most of the time. Quote Message Report. I use 4 indicators, primarily just two, the other two are just for a glance to help understand the overall trend. I still have no clear ideas about stoploss.|
|Forex indicators are useless||Foreign exchange forex market of russia|
The main benefit of the market, is the diversity of options available, and the fact that every day traders can analyze hundreds of different products in order to find one that suits their personal trading style and interests. The reason that this is ranked number one, is because each system comes with client reviews, comments and free demos. The flip side of having so many options, is the fact that it can be very difficult to sort through each of the products and decide which Forex indicator is best and most viable for your current trading approach.
Obviously, it takes a fair bit of knowledge in order to code an indicator, but most of the coders that are providing these systems do not work for a company, and thus there is no real guarantee that they will continue to support the product they are providing.
Most of these coders are highly skilled amateurs, and sole proprietors of their trading products. This market is highly effective, because it gives traders the opportunity to seek out and download Forex indicators without taking any risk or requiring any initial investment. PipFinite Trend Pro could essentially be categorized under the MQL5 umbrella, because it is indeed sold in the MQL5 market, but it deserves its own ranking as it is the most popular Forex indicator out of the thousands on their website.
First released on January 15, , this Forex indicator uses support and resistance levels alongside a strict set of rules that trigger buy and sell signals accordingly. It also includes a success rate metric, which gives traders an idea as to how effective a trading signal is likely to be, before the trade is placed. The indicator is aesthetically pleasing, and sends trade alerts via sound alerts within meta-trader 4, push notifications and email.
A couple months after completing our review, it came to our attention that the popularity of the indicator, and the overall rating on the MQL5 marketplace, is actually misleading. The vendor requests that his clients provide a 5 star review of this service in exchange for a free scanning indicator. Clients are expected to post a positive review, which skews the results and keeps this in the top 10 mt4 indicators list at MQL5.
After the client provides proof that they posted the positive review, then the vendor will give them access to a free Forex indicator. The main difference between this product, and most of the others reviewed in this section, is that the vendors actually provide the strategy in both indicator and Forex robot form.
This is a very helpful approach, because it gives the vendor the opportunity to easily provide the community with verified trading results, although much like every other vendor in this market, they fail to do so. The one aspect that sets this Forex indicator apart from the rest, is the fact that they provide an automated robot with the indicator.
The more we analyze this program, the more we see that this is a requirement. There are just too many trades being opened and closed simultaneously, for a trader to keep up with them all. The service belongs in the best MT4 indicators category, but ratings change over time as the markets shift.
APA Zones is both a Forex indicator and educational service that wants to help introduce and strengthen the knowledge of their clients on price action trading. Their program includes training videos, indicators, templates and the community Skype room to discuss trading strategy. The indicator is offered by Gabriel brand, a sole proprietor located in Long Beach California.
While the majority of the review is positive, this product is still somewhat confusing, and not very popular among the overall Forex community, which is why it is currently ranked number 4. Instead, it is developed by a company that claims to have 15 years of experience in the trading industry. None of these claims are substantiated in any real way. The vendor provides no information about their trading strategy, and the same could be said of their lack of trading results.
Since the vendor gives us almost nothing to go on, we have to rely on the client feedback, which there has been quite a bit of it in our review. While we are happy to see that the support team did follow up with some of the comments, they were never able to provide any verified trading results. The most recent comment is from a client that claims that the software never worked as advertised, which forced them to eventually ask for a refund.
They feel that their Forex indicator service stands the test of time because they use multiple signal systems simultaneously in order to actively monitor the current market conditions. For detailed information about the strategy, the vendor provides a handful of videos on their website.
While the sales page is aesthetically pleasing, the vendor provides very little information about their product. Our review has attracted 11 comments from traders utilizing the software, and the only experiences shared so far have been negative. The majority of the clients claim that the win rate is not realistic, and that the indicator provides too many false signals to be trusted. EFC Indicator is a Forex trading product that promises to find effective opportunities for its clients in less than 60 seconds.
The indicator is built to automatically detect reversal patterns and take advantage of a 1 to 3 risk reward ratio in order to grow accounts steadily. The client feedback for the indicator is in the middle of the road. One of the clients claim that they attempted to utilize the indicator for binary options, but was unsuccessful. Yet, when he contacted the developer, they refunded him with no questions asked, which is certainly a good sign.
Another commenter echoed his sentiments, which makes me believe that the vendor is a showing some positive signs. There are no real trading results to go on, as the vendor only provides a couple of different screenshots, of how the system works.
In the analysis today, we will be monitoring and reviewing four factors that will lead to a ever-shifting, live ranking system of the proven Forex indicators. These 4 elements will help in the final rankings of the indicators, and give you an insightful checklist to sort through:. If the service is effective in achieving a high rating in these categories, then it will rank well. In order to get the most out of this page, you first need to understand the different types of Forex indicators available.
For the most part, commercial Forex indicators are MT4 or MT5 based systems that analyze the market, and trigger trade alerts when the conditions or rules of the system is met. Trade alerts are pop up boxes in MT4 that direct traders on specific trades to place, generally including the entry price, take profit and stop loss.
These are the most popular products that are promoted in the indicator marketplace. Then, there are Forex indicators that paint on your charts to help you spot patterns better, see market movements, and utilize different data points like the relative strength index. Overall, these types of indicators are more for advanced traders that are looking for ways to bolster their manual trading approach. Instead, our analysis is more directed at the best Forex indicators that provide trade alerts, and give traders direct trading advice.
The way we look at indicators is different in , then it was just a few years ago. Our expectations are much higher, and we feel that the commercial vendors need to be held to a higher standard of accountability and transparency. Commercial Forex expert advisors are very simple to utilize. However, this does not mean that the Ichimoku Kinko Hyo indicator is the best or that technical indicators as a whole are useless.
Think of all those martial arts movies you watched growing up. The Rock used a combination of moves to get the job done. Forex trading is similar. It is an art and as traders, we need to learn how to use and combine the tools at hand in order to come up with a system that works for us. To be a great champion you must believe you are the best. If you're not, pretend you are. Muhammad Ali.
Partner Center Find a Broker. Bollinger Bands. Cover and go long when the daily closing price crosses below the lower band. Cover and go short when the daily closing price crosses above the upper band. Parabolic SAR. Cover and go long when the daily closing price crosses above ParSAR.
We certainly get their point. Trading indicators are great when it comes to filtering out bad trades and improving on a trading strategy. Combing price patterns with trading indicators is also a great way of reducing the risk of curve fitting. In other words, your strategies are likely to become more robust! As such, we wanted to touch on one approach where indicators have worked especially well for us.
As you might know, stocks generally tend to mean revert quite a lot, and by using some quite common trading indicators, we can capture this behavior in an effective manner. Two trading strategies that do this quite well make use of the RSI and Bollinger band indicators. Another quite useful way of using indicators, is to demand that the market closes below the lower Bollinger band.
The upper band is placed two standard deviations above the moving average, while the lower band is placed two standard deviations below the moving average. In other words, the market is oversold once it goes below the lower band, and this is what we may take advantage of.
So, having covered what we think about trading indicators, we just wanted to respond to the two most common criticisms of trading indicators. While this is true and you can trade just by using raw market data, the truth is that trading indicators add great value. As we covered earlier, you make the best use of trading indicators as filters or extra conditions on top of a price action based signal. For instance, there is the ADX indicator, which gives a great measure of the volatility in the market, which has a huge impact on many trading strategies.
Sometimes a trading strategy might not even be tradable without an ADX filter! In that sense, trading indicators truly add a lot of value to the trading process, and should not be discarded. And as we have shown in this article, they may even make up great entries if used in the right way!
The state of the market preceding the trading signal is of utter importance when it comes to deciding whether a trade is worth taking or not. As a matter of fact, some of the most effective filters include the period moving average, which definitely is a lagging indicator.
Still, it adds a lot of value to our trading strategies, and we will continue to use it going forward! In our opinion, the two criticisms above are way too generalizing to be accurate. Besides, different traders will have differing opinions on most things, without anyone being more right than the other. So here come our top three!
If you want to read more about any of the three indicators, you may just click the hyperlinked indicator names! As we told you at the beginning of the article, there is another way in which you could use trading indicators. In addition to using trading indicators to define when to enter a trade, you could bring them up to the strategy level, to assess how the strategy itself is performing.
For instance, you could apply a moving average to the equity curve of the strategy, and see if there is any point in only trading strategies that are below or above their average. As said, we have not had that much luck with this approach, but know that some traders have developed methods where they switch on and off trading strategies based on this.
Even though there are some traders who believe that trading indicators are useless, we cannot agree. Signup Here Lost Password. Moving on, here are the results of our backtest:. The data showed that over the past 5-years, the indicator that performed the best on its own was the Ichimoku Kinko Hyo indicator. Surprisingly, the rest of the technical indicators were a lot less profitable, with the Stochastic indicator showing a return of negative However, this does not mean that the Ichimoku Kinko Hyo indicator is the best or that technical indicators as a whole are useless.
Think of all those martial arts movies you watched growing up. The Rock used a combination of moves to get the job done. Forex trading is similar. It is an art and as traders, we need to learn how to use and combine the tools at hand in order to come up with a system that works for us.
To be a great champion you must believe you are the best. If you're not, pretend you are. Muhammad Ali. Partner Center Find a Broker. Bollinger Bands. Cover and go long when the daily closing price crosses below the lower band.
Most technical analysis Indicators are useless because they were not designed for day trading. Indicators were used in the era when exchanges didnt use digital. yolic.xyz › blog › why-i-ditched-technical-indicators. Technical indicators are no doubt a favorite topic in the financial markets. They can range from a simple moving average to a complex array of algorithms.