Using Oscillators or Leading Indicators
When it comes to using leading indicators, a good way of remembering how they work is to understand that they “oscillate” between two points, hence the name oscillator. This means that they bounce back and forth from point A to point B, which is another way of saying that what goes around comes around. When […]
How Moving Averages Work
This section covers the basic technical indicators used in forex trading, the most common of which is the moving average. As the name suggests, this kind of technical indicator measures the average closing price of the currency pair for a specified period. For example, using the moving average (20) on an hourly chart takes the […]
Fibonacci Retracement
Fibonacci retracement levels, which are commonly used to specify potential entry levels during a trending market environment, comprise another group of inflection points. These retracement levels were based the work of Leonardo Fibonacci, who is a famous mathematician known for his discovery of the golden ratio. According to Fibonacci, this ratio describes the natural proportion […]
Pivot point calculation methods
Pivot point calculation can be tedious for some but there are traders that find this method very reliable when coming up with shorter-term trade setups. Trading the news or economic events can also be combined with intraday setups using pivot points. In particular, range traders look at pivot points for potential reversals in price action. […]
Double Candlestick Patterns
Memorising double candlestick patterns can be a bit more challenging, but the trading results can be very rewarding. As with the single Japanese candlestick patterns, these come in bullish and bearish versions. The most basic type of dual candlestick formation is the bullish or bearish engulfing pattern. Simply put, the engulfing pattern occurs at the […]
Support and Resistance
Support and resistance are two of the most frequent forex terms you will come across in technical analysis. Simply put, support refers to a floor in price action where a downward movement changes course. On the other hand, resistance stands for a ceiling in price action where an upward movement reverses. A good rule of […]