Using Trading Indicators

  • : Technical indicators are readily available calculated values that can be used as a guide in making trading decisions. It is different from other analysis as most of the data is readily available and automated. However we should not make mechanical decisions based on these indicator although they can be used as additional information before making a trading plan and decision.
  • : Moving average is one of the most widely used technical indicators for validating the movement of markets.Moving averages are known to be lagging indicators, they lag behind movements in the price/volume charts. -A faster MA has less lag when compared to the slower MA.
  • : RSI ( Relative strength index ) is a momentum indicator having two horizontal lines indicating 70 at top and 30 at bottom.This indicator works well with in this zone 30 to 70. Price movement above 70 shows OVER BOUGHT area and price movement below 30 shows OVER SOLD area BUYING ZONE: When price crosses ABOVE exactly at 30 it the right point to buy
  • : The Fibonacci series is a sequence of numbers starting from zero arranged in such a way that the value of any number in the series is the sum of the previous two numbers.The Fibonacci sequence is as follows: 0 , 1, 1, 2, 3, 5, 8, 13, 21, 34, 55, 89, 144, 233, 377, 610 Divide any number in the series by the previous number; the ratio is always approximately 1.618.The ratio of 1.618 is considered as the Golden Ratio, also referred to as the Phi. When used in technical analysis, the golden ratio is typically translated into three percentages: – 38.2%, 50% and 61.8%.
  • : Fibonacci retracement levels operate as percentages based on the collective belief that stocks tend to "retrace" their paths after sizable moves, regardless of direction. A trendline is established between the highs and lows, and then divides the vertical distance by these key Fibonacci ratios: 23.6%, 38.2%, 50%, 61.8% and 100%. As the price of an equity retraces after a significant move in either direction, it may stall at support/resistance near the Fibonacci lines.
  • : What are the common indicators used by traders ?
  • : suggest me the indicators need to be used for intraday

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