Major Oscillator Indicators

There are a number of oscillators that can aid your trading. The oscillators make it easy to find great buy and sell signals. These signals can help you to make informed short term decisions about where a stock is likely to go.

Below is an example of how you can use some of the most common oscillators to predict market movements.

1. The ADX oscillator is a very powerful indicator. This indicator graphs a line that bounces between 0 to 100. If the line is below 20 it is said to be low if it is above 40 it is said to be high. Unlike most oscillators this one does not tell you whether to buy or sell a stock.

It only tells you how strong the trend is. If a stock is trending up and the ADX is high that signals that the trend is going strong and will most likely continue. If it the trend is up but the ADX is low that signals that the trend may not be that strong. In this case you may not want to enter it or if you are in it you may want to tighten up your stops.

2. The RSI is more of a traditional indicator. I say that because it gives you actual buy and sell signals. Like the ADX the RSI is also a line that bounces between 0 and 100. Unlike the ADX when the RSI passes the 50 mark it signals the trend is changing.

This gives off a buying signal if it crosses over to the upside and a selling signal if it crosses over to the downside.

3. The Bollinger Bands indicator is another widely used Oscillator. It makes two lines on the stock chart. One above the price and one below the price. When the stock hits the bottom line it should bounce up to the top line. When it hits the top line it should bounce down to the bottom line. These lines always adjust to fit the price movement of the stock.

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Forex Trading Education - 3 Major Fundamental Indicators

Fundamental indicators are basically news announcements that involve the sensitive economic data of a country. Forex traders take a very keen interest to these announcements because the currency markets typically react significantly to them.

In this article, I will briefly cover the 3 major indicators that affect the currency markets the most.

Indicator #1: Federal Open Market Committee (FOMC) Meetings

The FOMC meets eight times a year to review and evaluate the effects of monetary policies and to make appropriate adjustments when required. This is effectively the most important event in Forex trading, in terms of price volatility. Interest rate increases and decreases typically affect currency prices to a great extent.

Indicator #2: U.S. Non-Farm Payroll

This is a significant economic announcement that is released on the first Friday of every month. The non-farm payroll announcement basically reports on the strength of the nation's business and government sectors in terms of the number of workers. Generally, a strong non-farm payroll figure indicates a robust economy. If positive figures are expected, the U.S. Dollar will typically rally.

Indicator #3: Gross Domestic Product (GDP)

This indicator measures the sum of all goods and services produced by all the businesses in a country. GDP figures indicate whether a country is expanding or shrinking. It is a broad measure of a country's economic power and growth. Good GDP figures usually inspire confidence in investors, leading to a rally of that country's currency value.

At this point, I would like to mention that these fundamental indicators should be mainly used for educational purposes only. They should be used to back up trading decisions, and should NOT be used alone to initiate trade entries. While news trading can be potentially lucrative, chances are that you'll often find yourself at the losing end of the trade instead. Don't news trade!

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Forex Trading Education - 3 Major Fundamental Indicators

Fundamental indicators are basically news announcements that involve the sensitive economic data of a country. Forex traders take a very keen interest to these announcements because the currency markets typically react significantly to them.

In this article, I will briefly cover the 3 major indicators that affect the currency markets the most.

Indicator #1: Federal Open Market Committee (FOMC) Meetings

The FOMC meets eight times a year to review and evaluate the effects of monetary policies and to make appropriate adjustments when required. This is effectively the most important event in Forex trading, in terms of price volatility. Interest rate increases and decreases typically affect currency prices to a great extent.

Indicator #2: U.S. Non-Farm Payroll

This is a significant economic announcement that is released on the first Friday of every month. The non-farm payroll announcement basically reports on the strength of the nation's business and government sectors in terms of the number of workers. Generally, a strong non-farm payroll figure indicates a robust economy. If positive figures are expected, the U.S. Dollar will typically rally.

Indicator #3: Gross Domestic Product (GDP)

This indicator measures the sum of all goods and services produced by all the businesses in a country. GDP figures indicate whether a country is expanding or shrinking. It is a broad measure of a country's economic power and growth. Good GDP figures usually inspire confidence in investors, leading to a rally of that country's currency value.

At this point, I would like to mention that these fundamental indicators should be mainly used for educational purposes only. They should be used to back up trading decisions, and should NOT be used alone to initiate trade entries. While news trading can be potentially lucrative, chances are that you'll often find yourself at the losing end of the trade instead. Don't news trade!

Read more...