Every skill you learn can be put into your forex analysis toolbox. These foreign exchange analysis tools will help you easily create your own trading account.
It is a long way to learn foreign exchange market knowledge, and we recommend that you often go back and read the knowledge you are not very familiar with before. Sometimes it takes repeated reading if you want to really get the gist of what you've learned. Once you grasp the concept of these forex indicators, go to the charts and start experimenting with them. Experience how these indicators react to price fluctuations in practice.
As you learn about each indicator so far, add them as a new tool to your toolbox. Maybe you won't use them very often, but it's always nice to have another option. Now that we have enough tools ready, let's start learning together.
If there are too many variables involved in the analysis tool, it is not easy to turn such analysis tool into a clear trading strategy. Without a clear trading strategy as a guideline, it is naturally difficult to formulate a trading discipline that can be followed, and it is impossible to know whether one's operations are running on the right track.
Therefore, when choosing an analysis tool, it is necessary to choose a systematic analysis tool that can clearly formulate trading strategies and can clearly follow the trading discipline.
Forex technical indicators are divided into three categories - trend indicators, oscillators and sentiment indicators
Trend-following indicators are trend-following in nature and are primarily designed to follow a rising or falling market. They often perform poorly or not at all when the market enters a sideways phase. It is precisely during such sideways market stretches that trend-following traders are most vulnerable to setbacks.
Oscillators, on the other hand, do a lot in a sideways market.
Sentiment indicators are indicators that reflect changes in long-short sentiment and hope to predict market trends.
Analysis Tool Operation Count and Importance
Raw Analysis Tools
For example: Sakata's tactics and Dow Theory... Various patterns that directly show price trends in graphs are used as analytical tools for judgment without formula calculations.
One-Calc Analysis Tool
For example: moving average (Moving Average), Bollinger Bands (Bollinger Bands)... and other main chart indicators, the accuracy of the trading strategy set by using this type of analysis tool is not bad, but it is better than the trading strategy set by the uncalculated analysis tool Less explicit! Trading discipline at the time of execution is more likely to create room for ambiguity! However, because this type of analysis tool can also display specific trend prices, it is still a very reliable decision-making analysis tool.
Sub-picture indicators after multiple calculations
For example: RSI, KD, DMI...Because this type of analysis tool has undergone multiple calculations, it deviates the farthest from the actual trend price, it is difficult to set an accurate and followable trading discipline, and it is impossible to know whether your operation is running correctly on the track. Although it seems to be very accurate to explain the market trend afterwards, it is difficult to implement it clearly in the market. Therefore, this type of analysis tool can only be used as a reference when executing a trading strategy, and is not recommended as a decision-making basis for making a trading strategy.
importance ranking
Index of the main image > index of the secondary image;
Uncalculated analysis tools > once-calculated analysis tools > multiple-calculated secondary graph indicators.
The closer the analysis tool is to the price trend, the higher the accuracy of the operating strategy is. The chart is the display of the price trend, that is, the technical graph was invented to record the fluctuation of the trend, so the analysis tool without calculation is the closest to the price The trend is the simplest and clearest to use. Using this type of indicator, it is easy to formulate a clear operation strategy, and it is easier to abide by the trading discipline. This makes the use of this type of analysis tool the most accurate and the most profitable.
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