What are Forex Indicators?
A forex trader is always looking at the best point to enter a trade and to exit one.
As a trader studies the charts, he or she looks for ways to identify points at which support floors or strong levels of resistance will appear.
Sometimes prices range, and move from a clear point of support to resistance and back again.
In other markets, called “trending markets,” there is steady movement higher or lower.
It is critical to understand exactly what constitutes a trend.
What is an uptrend? It is a market in which each successive high is higher than the previous high. Similarly, a downtrend, is a market in which each successive low is lower than the previous low.
To help traders identify ranging or trending prices, indicators are used.
These are mathematical algorithms of one kind or another that have been shown to identify when price change takes place.