Most Popular Oscillator Indicator In Forex

In practicing forex trading this time, we will discuss forex trading by using oscillator markers. As we have learned from the previous post, is one way to help describe the current market situation and calculate future price movements based on the charts that have been created, forex traders often use Technical Markers. There are various kinds of Technical Markers that can be used by a trader, but before starting to use it, it is better for us to first study the interpretation of technical markers and their kinds.

It's not too late to say that on this earth there are dozens of Technical Markers. Every mathematician, statistician and expert in financial markets can create his own indicator. If the Technical Marker proves to be of considerable accuracy and is favored by other market players, then it can be disseminated to be used by traders around the world. However, in the usual way, judging from the shape, Technical Markers can be divided into 2, namely the Overlay type and the Oscillator type.

In connection with our upgrading theme this time, we are discussing forex trading using oscillator markers, so in this post we discuss what oscillator markers are first and for overlay technical markers we will discuss next.

Oscillator markers are tools used to measure the momentum of price movements from bullish to bearish goals and vice versa. By recognizing the momentum of price movements, we can find out if the trend is about to start and if it is the best time to bring back the pips that we have successfully collected before the trend changed goals. Not only that, in contrast to the Overlay type marker which is mainly calculated from price information, some Oscillator type markers also predict trading load instability on an instrument.

As informed in the early paragraph above that on this earth there are a lot of technical markers that can be used. However, there are 3 oscillator markers that are very widely used by traders. What are the markers then the description.

Moving Average Convergence Divergence( MACD)

MACD is a marker that can be used to identify when it feels like the trend is changing direction. What you need to pay attention to when you use this marker is the change of the histogram pattern from top to bottom and vice versa.

Relative Strength Index( RSI)

Closer to the stochastic, the RSI marker is also used by traders to identify overbought and oversold zones. Born by a technical analyst named J. Welles Wilder, RSI is arguably a very well-known marker among reliable traders.

Stochastic Oscillator

Stochastic is a marker that was born by George Lane in the 1950s. Initially, Lane produced this marker to identify the momentum of price movements. But now most traders use stochastic markers to identify whether the market has entered the overbought or oversold zone. What you need to pay attention to is the following. If the stochastic lines enter the OVERBOUGHT zone (above 80), get ready to take a SELL position. On the other hand, if the stochastic lines enter the OVERSOLD zone (at bottom 20), get ready to take a BUY position.