Before discussing further about forex indicators, it is a good idea to know what forex trading is. Forex trading is a business that is on the rise. This business is growing along with the increasing need for jobs. And the forex business is one of the modern community businesses that is tempting to generate money.

Because this business can generate considerable profits, this job is also considered simple because it can be done at home. No need to leave early in the morning, no need to dress neatly in a tie, and no need for a strict and busy work schedule. Everything can be done at home with flexible time and you can be your own boss. So, what is the practical way to become a successful trader?

Best Forex Indicators

After understanding what is meant by forex trading business, to be able to become a successful trader as a beginner you also need to learn some indicators that will facilitate the forex trading business. The use of this technical indicator is very important in the trading process to train the sharpness in reading signals so that false signals do not occur. There are 3 best forex indicators that are quite popular and often used by beginner traders in starting this business, namely:

Moving Average

Moving average is the best and simplest forex indicator in determining the right time for the trading process. Traders simply observe the right time to trade by paying attention to the combination of several MA (Moving Average) lines and making one MA line with the longest period (100, 200) as a benchmark for reading when an uptrend or downtrend occurs.

Because MA functions as a filter for random price fluctuations that are trend following and lagging because they are made based on prices that have occurred. MA is calculated based on the average value of price movements in a certain period, it can be from the highest price, the lowest price, the opening price, the middle price, or the closing price. For example, if an uptrend occurs, add several short-period MA lines and observe their positions. If the position starts to intersect with the long-period MA, it means you have to prepare in the 'buy' position.

MACD (Moving Averages Convergence Divergence)

This indicator is used to see the average movement of the graph and the deviations that occur. Because when this deviation occurs, the price will reverse direction by forming a long trend and that is the right time to enter the market. There are 2 deviations that need to be considered in the MACD indicator, namely:

    • Convergence is a condition where the graph is getting lower but the indicator is getting higher. And when convergence occurs, the graph turns upwards, that's the right time to open a buy.
    • Divergence is a condition where the graph is getting higher but the indicator is getting lower. At that time the market will reverse direction to go down and that is the right time to open sell

RSI (Relative Strength Index)

RSI is an indicator that functions to find out whether the price of the currency we are buying and selling on the forex market has entered the overbought (overbought) or oversold (oversold) stage by paying attention to the lines at the top and bottom. The market is considered oversold if the RSI is below 30 and is considered overbought if the RSI is above 70.

MUST READ!

All About Moving Average Technical Indicators

Moving Average is: Definition and Types of MA

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Moving Average: Definition and Types of Moving Average

 

Function of Indicators in the Forex Trading Process

Based on the explanation above, it can be described that the general function of the three indicators is to provide market condition information mapping to traders so that they can determine the right strategy and provide signals that can provide indications for traders to be able to enter points or exit points.

So, if you are a beginner trader, try to learn these 3 indicators so that you can determine the right steps in your forex business in order to get maximum results. To be able to get maximum results, you must also choose a platform that provides facilities: the lowest spread, then it must also be free from swap fees to lighten swing positions and of course the lowest transaction costs, to speed up BEP.

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