Indicators are tools with the predefined analysis and set of algorithms, this can be applied on the trend to get the indication of price movement. It can be used as supporting tool to confirm the analysis derived from the technical analysis. But the indicators does not work in all scenarios, some of them work for trending and some of them indicate well in non trending zone.
When the RSI is applied on the non trending zone, it provides the index with the mark of 70 and 30 scale. … When the index moves below 30, it indicates the aggressive selling pressure and when it crosses 30 again and moves above, it indicates the bullish trend and the long position can be created to buy.
Moving average is one of the most commonly used technical indicator by traders to analyse the trend of the market. Moving average is calculated by taking the average of past closing data prices. For example, 20 day moving average calculates the average price for last 20 days