In trading, you can predict currency price movements using several analytical techniques. One of them is technical analysis with charts and indicators of price movements.
If you use MetaTrader4 or MIFX Mobile software for trading, there are various indicators. However, you might be confused to decide which indicators that are easy to use.
Check out these three technical indicators that easy to use:
Moving Average
According to Investopedia, The moving average (MA) is a simple technical analysis tool that smooths out price data. Most traders often use this indicator since it is simple and easy to use. This indicator illustrates changes in average prices in a given period.
Moving averages consists of lines that represent the average prices traveled by the currency pair you choose. Thus, prices that move above the MA period can be considered as a signal. The signal still has the potential to strengthen, and vice versa.
RSI (Relative Strength Index)
RSI is an indicator of trade momentum that shows the speed and magnitude of price changes in an instrument. The RSI indicator is in the form of a graph that moves between 0 – 100 with a barrier at levels 30 and 70.
The movement of the chart passes the 70 levels indicates an overbought pattern or the instrument has almost reached the saturation point of purchase. Conversely, if the chart drops to below level 30, it indicates oversold, or the instrument has lost its appeal and has been sold too much.
Bollinger Bands & Parabolic SAR
Bollinger bands are often regarded as indicative of a market’s volatility. Indicators consisting of two parallel lines will look away from each other when high volatility, and will narrow when market conditions are stagnant.
While parabolic SAR is an indicator in the form of a circle that is at the top or bottom of the graph. When the circle appears at the bottom of the chart, it indicates the price will move up, whereas if it appears above the graph, the likelihood of what happens is the opposite.
