Traditionally there are 4 types of forex indicators (and oscillators)http://www.usfestivals.com each of which gives us specific information on the price trend of an asset:- TREND INDICATORShttp://www.usfestivals.com highlights and there is a clear trend (bullish or bearish)- MOMENTUM INDICATORShttp://www.usfestivals.com highlights the strength of a trend (bullish or bearish)- VOLATILITY INDICATORShttp://www.usfestivals.com highlights how prices are fluctuating- VOLUME INDICATORShttp://www.usfestivals.com shows how many operators are active on the market
As we will see shortlyhttp://www.usfestivals.com some indicators do not fall into just one categoryhttp://www.usfestivals.com but are “hybrids” because they can fall into two categories at the same time.Thushttp://www.usfestivals.com for examplehttp://www.usfestivals.com the famous Bollinger Bandshttp://www.usfestivals.com which are very effective indicators of volatilityhttp://www.usfestivals.com but at the same time also highlight the presence of a trend. We can give an example using the Plus500 webtrader: as you can seehttp://www.usfestivals.com the Bollinger Bands provide us with a clear visual representation of both the price trend (rise / fall) and how large the price fluctuations (volatility) are.
IMPORTANT CLARIFICATION. We must reiterate strongly that each indicator falls into a certain category since it provides us with information on a specific aspect (trendhttp://www.usfestivals.com volatilityhttp://www.usfestivals.com volumeshttp://www.usfestivals.com momentum); we reiterate this because many traders who want to obtain an indication of market …