There are various Indicators used by Forex traders like MACD, Pivot Points, Moving Averages, Bollinger bands, Japanese candlesticks etc for assisting them to figure out where and when to input in addition to exit trades. It is possible to use technical indicators and make profit but lot of dealers misunderstand or overemphasize them and suffer losses because of that. The majority of the Forex traders think that they could easily obtain a Forex index and then use it to their trading platform automatically and make lot of money that’s only a mere illusion. Successful traders know that there’s lot of working involved with indicators than generating purchase/sell signs or to precisely pin-point the transaction entry points. Forex technical indicators are merely a part of your trading strategy and they can’t fix all of your problems. You shouldn’t put all of your hope blindly in certain indicators without understanding the functioning of every one of them.
As an Example, Moving Average indicators are used for showing the trend management. The often used indicators are 50 day MA, 100 day MA, 35 afternoon MA, 200 day MA etc and they’re merely valid with daily charts. MT4 インジケーター think that great trading signal is when 50 day MA is crossed by 13 day MA as it occurs; you should start trading in direction of the cross. The problem with this is that, such sort of crosses do not occur frequently that can be exploited by dealers and they generally result in a situation where traders see that the cross they exchanged was actually reverse. It could be worst situation when day traders expect such spans and you really move away from market that you attempt to trade. You wouldn’t simply guess the cost would be following, but also guess the index position based on costs.
Apart from that there Are several other problems with technical indicators such as issues with quotes and prices provided by brokers. Various Forex brokers shall offer different rates and quotes at specific point of time that could confuse you a lot. The random Forex technical indicators have same impact and traders will provide several responses to each of these.
Also, many of Technical indicators are often developed by dealers involved with stock exchange. With advancement in computers and technology, they’re implementing these indexes into Forex marketplace. However, you have to know that these indicators haven’t been tested with real time information and couldn’t be trusted. Whatever index you use, you have to be aware of the functioning of it and make sure whether it’s been proved successful with real money with a live trading account.