Sunday, June 17, 2007
Forex Day Trading system - Importance of an oscillator
Forex Day Trading system - Importance of an oscillator such as Stochastic
Lot of people try to place trade using a lot of indicators. Well the more the indicators, the less the number of forex trades one can place since one will wait for all the indiactors to line up which will not happen too often.
More than that it also confuses matter. According to me use of 2-3 technical indicators tops is good enough. Let one be your leading indicator such as EMA crossover or the bounce from fibonacci level. The others of maximum two can be your confirming indicator such as MACD divergance or the stochastics or the RSIs.
The best way to use stochastic which is an oscillator indicator is to check if they are in the overbought level or oversold level. If they are in overbought level, then look for opportunities to sell the currency pair. However if it is oversold, look for the opportunity to buy thye currency pair.
Keep the indicators very limited. Remeber the placing of a forex trade on any currency pair such as USD/CHF or GBP/USD or EUR/USD or any currency pair is all about probability..Its not gaurenteed that the trade will be profitable..However the probability of a profitable trade will be high.
Thats all in this message..Keep visiting to learn more on forex day trading.
Lot of people try to place trade using a lot of indicators. Well the more the indicators, the less the number of forex trades one can place since one will wait for all the indiactors to line up which will not happen too often.
More than that it also confuses matter. According to me use of 2-3 technical indicators tops is good enough. Let one be your leading indicator such as EMA crossover or the bounce from fibonacci level. The others of maximum two can be your confirming indicator such as MACD divergance or the stochastics or the RSIs.
The best way to use stochastic which is an oscillator indicator is to check if they are in the overbought level or oversold level. If they are in overbought level, then look for opportunities to sell the currency pair. However if it is oversold, look for the opportunity to buy thye currency pair.
Keep the indicators very limited. Remeber the placing of a forex trade on any currency pair such as USD/CHF or GBP/USD or EUR/USD or any currency pair is all about probability..Its not gaurenteed that the trade will be profitable..However the probability of a profitable trade will be high.
Thats all in this message..Keep visiting to learn more on forex day trading.
Labels: fibonacci levels, forex day trading, forex ema, forex macd, forex technical indicators, oscillators, stochastics
