Why do forex traders use indicators? Investors use all the information they can in order to determine when to sell or buy. Indicators can help traders to identify those prices.
Indicators are the key elements of technical analysis. They are mathematical calculus, plotted in charts, and also manual draws. Even traders can create their own indicators or use personal combinations.
The most popular technical indicators are: moving averages (MA), supports and resistances, oscillators like stochastics, Relative Strength Index (RSI), Moving Average Convergence Divergence (MACD), Commodity Channel Index (CCI), Bollinger Bands and Fibonacci levels.
Which one is the best? There is no such thing. The best indicator should be the one that offers the best signals. However, an indicator that works for one currency pair or during some period of time, might not be helpful with other pairs or in other timeframes. Using too many indicators do not necessarily lead to better analysis, more often it confuses and gives no clear signals.
