Best Combination Of Forex Indicators For Intra day Trading

Many traders are looking for the holy grail of trading by applying dozens of technical indicators to their screen.

Unfortunately, instead of becoming the royal road to profits, most of those indicators are either providing the same information or generate contradictory trading signals which can confuse a trader and lead to whipsaws and losses. Finding the best combination of Forex indicators for day trading can be quite hard – a trend indicator says “buy” when an oscillator says “sell” and vice-versa. 

However, by combining different indicators to different timeframes, a trader can take advantage of their strengths and reduce fake signals to a minimum. 

Keep reading, and we’ll show you how to day trade with the popular Triple Screen trading system that uses both trend-following and momentum indicators.

Types of Indicators

• Trend Indicators – Trend indicators are designed to measure the strength and direction of a trend. If a market is in a strong uptrend, a trend indicator gives you a buy signal, and if the market is in a strong downtrend, trend indicators give you a sell signal.
• Momentum Indicators / Oscillators – Another popular group of technical indicators are momentum indicators, also called oscillators. Unlike trend indicators, oscillators measure the relative strength of recent price-moves and plot a value between 0 and 100 – hence their name. If prices are rising strongly, an oscillator follows and reaches overbought levels, giving you a sell signal. Similarly, if prices are falling, an oscillator reaches oversold levels and sends a buy signal.
• Volatility Indicators – As their name suggests, volatility indicators measure the rate of price-changes regardless of their direction. Volatility indicators rise when markets are fast and fall when markets are slow. Popular volatility indicators include Bollinger bands and the Average True Range (ATR).
• Volume Indicators – Volume indicators measure the strength of a price-move by using the information of trading volume. While volume indicators are very popular among stock traders, Forex traders can’t take much advantage of them since there’re no reliable measures of trading volume in the currency market. Popular volume indicators are the Chaikin oscillator and On-Balance Volume (OBV).

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