Home » Subjects » Forex Technical Analysis - Graphical Indicators - Metatrader

Forex Technical Analysis - Graphical Indicators - Metatrader

25 of May of 2020 73
Forex Technical Analysis - Graphical Indicators - Metatrader

Technical indicators are plugins programmed based on statistics from trading platforms that mathematically analyze the relationships between various elements to try to predict the price.

Both beginners and more experienced traders can use technical analysis. Technical analysis uses Forex charts to make predictions and take trading positions.

To do this, just study the simplest indicators, which will help us:

  • indicate the possible market trend
  • determine support and resistance levels
  • identify graphic patterns

In general terms, there are four groups of technical indicators. The most popular are:

Trend Indicators
  • Moving Average : it is the most well-known trend indicator of all.
  • ADX: is another technical analysis indicator that tries to predict the strength of the trend and is based on EMA (exponential moving averages).
Example of Exponential Moving Averages on a Forex Chart - MetaTrader 5

Source: EURUSD, Chart H1, MT5 Admiral Markets. Data range: December 18, 2019 to January 14, 2020. Performed on January 14, 2020. Note that past performance is not a reliable indicator of future results.

In this example, you can see how the direction of the moving averages indicates where the market can go. In addition, the rising or falling cross from the shortest to the longest moving average can act as a confirmation of the buy or sell signals.

Other very popular trend indicators are:

  • MACD
  • Parabolic SAR
  • Ichimoku Kinko Hyo
Boost Indicators

The moment indicators in the technical analysis are used to indicate whether an instrument is overbought or over-sold. This measures the speed and magnitude of price movements.

  • Relative Strength Index ( RSI )
  • Stochastic
  • ATR (as a volatility indicator) or Bollinger Bands
Using the RSI Boost Indicator on a Forex Chart

Source: Demo Account – MetaTrader 5 Supreme Edition – EURUSD – Graph H1 – Data range: January 2, 2020 to January 14, 2020. Performed on January 15, 2020 – Please note that past performance is not a reliable indicator of future results.

Volume Indicators

The latter group should be highlighted, since trading volumes are its main source of information. There is no doubt that the technical analysis of the total traded volume is useful for stock, futures or commodity traders .

  • Money Flow Index technical indicator
  • Volume technical indicator
Technical Analysis - Volume Indicator on the MetaTrader 5 Trading Platform

Source: Demo Account – MetaTrader 5 Supreme Edition – EURUSD – Chart M30 – Data range: 10 January 2020 to 16 January 2020. Performed on 29 January 2020 – Please note that past performance is not a reliable indicator of future results.

Volatility Indicator

They monitor changes in market prices and compare them with historical values.

Among the volatility indicators, we find:

  • Average True Range – ATR
  • Bollinger Bands
Technical Analysis with the ATR Indicator on the MetaTrader 5 Platform

Source: Demo Account – MetaTrader 5 Supreme Edition – IBEX35 – Chart D1 – Data range: May 10, 2019 to January 23, 2020. Performed on January 23, 2020 – Note that past performance is not a reliable Indicator of future results.

Graphical Analysis – Tools to Identify Forex Chart Patterns

In the next section, we will explain how you can identify chart patterns on a trading chart. But, for that, it is necessary to know the different tools that we can use for this purpose.

The MetaTrader technical analysis platform, which you can find freely available through Admiral Markets, includes a wide variety of chart tools by default that can be used to identify chart patterns. Among these graphical tools, we find:

  • Lines: horizontal, vertical, trend, cyclic and angle.
  • Channels: equidistant, standard deviation and linear regression.
  • Gann tools: Gann line, Gann fan and Gann grid
  • Fibonacci tools: Fibonacci retracements, Fibonacci extensions, Fibonacci intervals, Fibonacci ventilator and Fibonacci arcs
  • Elliott waves : impulse waves and corrective waves
  • Among many others!

You can easily find these graphical tools in the “Insert” tab, at the top left of your trading platform, and selecting “Objects”. For example, let’s choose the popular graphics tool called “equidistant channel”.

With this tool, traders can draw upward, downward or side channels:

Graphical Analysis - Using Channels in MetaTrader 5 Supreme Edition

Source: Demo account – MetaTrader 5 Supreme Edition – EURUSD – Graph H1 – Data range: 21 January 2020 to 29 January 2020. Performed on 29 January 2020 – Note that past performance is not a reliable Indicator future results.

Related

Leave your comment

© 2021 - Forex MT4 Download

  • Facebook
  • Youtube