- Writer: Iain Johnstone
- Date: October 24, 2011
- Phrase Count: 522
If you’re looking for a perfect Forex charting tool that guarantees endless profits, think again—there’s no such thing. However, you can improve your trading success by combining various tools for better analysis.
There are three main analysis types in Forex charting:
- Trend Indicators: Includes moving averages and MACD.
- Oscillators: Common examples are Stochastics and the Commodity Channel Index.
- Sentiment Indicators: Like Put-Call ratios and Commitment of Traders reports.
It’s beneficial to combine these with other indicators like the Wave Principle, which can show trends and price targets. By analyzing wave patterns, you can improve your predictions for future price movements.
Interpreting wave characteristics can provide insights into market behavior. If your analysis is correct, prices will generally follow your predicted direction based on patterns and volume changes.
The MACD is a key indicator, tracking the difference between two moving averages. Look for signs of convergence and divergence, but remember this isn’t an exact science. Always confirm changes using additional information from other charting tools.
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