What Are Forex Indicators?

Professional traders use Forex indicators to help them identify profitable trading opportunities. These tools can be integrated in with any type of trading strategy and they can make a significant difference in your trading overall. Here are the basics of indicators and what they can do for you.

Indicators

These tools can be directly plugged into your trading platform. In fact, if you trade on the popular Metatrader platform, you will find that it comes with many pre-made indicators for your trading pleasure. You will find easy-to-use tools like weighted moving averages, stochastics and many more items.

Using the Tools

When you decide that you want to use one of these Forex indicators, you start out by opening a Forex chart. For example, let's say that you wanted to check out the EUR/USD pair. You would simply move your mouse over the EUR/USD section of the currency pairs in the top left corner. Then right click your mouse and you can choose to open a chart of the currency pair. At that point, you can go up to the top of the platform and select the type of indicator that you would like to insert into the chart. Once you select the indicator that you want, it will automatically show up on the chart that you have selected.

Custom Indicators

Even though most trading platforms come with plenty of built-in indicators, you can also use custom indicators if you wish. These are essentially small programs that have been created to plug directly into your trading platform. You can install them the same way you would any other piece of software. Then you can open them up and put them on your chart as if you were using a regular indicator.

Alerts

One of the beautiful features that many indicators have is alerts. You can put a group of indicators on your trading platform and leave them running while you are doing something else. When an indicator determines that a profitable trading opportunity could be occuring, it will alert you of it with a sound. You could even have it set up to send you a text message or an email, depending on what works best for you. This way, you will never have to miss a trade if you are away from the computer.

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