The eternal debate that most budding forex or CFD traders have centres around which form of analysis fosters more success. Is it better to be a fundamental trader or a technical trader? There is no data that suggests one form of analysis is better than the other. In most instances, it is rather the traders’ […]
The Forex or FX Market derives its name from Foreign Exchange. It is essentially the exchange of currency (money) between two different countries. The FX market is the largest financial market in the world, and is open 24 hours per day, 5 days per week.
The CCI was initially developed for the commodity markets but is widely used by FX and equity traders too. It measures the variation from the average and is similar to the RSI and Stochastics. It indicates a reversal of the trend.
Envelopes are based on a simple moving average. It uses a deviation to show an upper and lower trading band. When the market reaches the upper band, it indicates a short may be in play. The same applies to a long trade. An extremely useful tool.
Another indicator that can assist with determining the strength of a market move. The ADX is best used with a stochastic or RSI. Shows whether we have a weak or strong trend, not whether the market is overbought or oversold.
Often known as the “stop and reverse” indicator. It plots little dots above and below the price and helps identify a change in direction. Can also help with where to place stop losses.
The Relative Strength Index shows the magnitude of the recent price movements. The RSI shows the strength of the market move in one direction or the other.
This indicator shows the momentum of a trend. It shows when a current trend may be over bought or over sold.
The MACD is a trend following indicator that helps identify the strength of a trend or a change in trend.
Bollinger bands have a number of valuable uses. Whether it is following trends or looking for possible entry and exit points. Understanding these can be very useful to FX traders.