The concept of technical indicators in foreign exchange
Foreign exchange pass f premiumrebateforexancial investment training editor in th How Forex Rebates Work article about "oscillating bestforexrebaterates" cashbackforexreview indicators, for many technical cashback forex novice, may need to introduce some "technical indicators" to use the "previous conditions concept" before talking about "technical indicators" itself to have a step, but also more clearly underst HowForexRebatesWork how to use in a certain market, under different conditions, the "technical indicators". The so-called "technical analysis method" is actually a method of studying "past price behavior", when we get sufficient evidence from past data and daily market behavior to determine the next "possible market direction", so the "technical analysis method" is almost a "scientific method of chance statistics". In terms of technical analysis, there are a few concepts that are important to many novice traders or technical analysts. Of course, technical indicators are not only used in forex, but all kinds of trading commodities can be applied. From a scientific point of view, the market is nothing more than a series of digital signals, and this signal line is only a two-dimensional signal (2DSignal), that is, "time" and "price", as far as I am concerned, these market signals are really like the human "voice" signal "voice" signal analysis is the same as a two-dimensional signal (2DSignal), but it is "time" and "amplitude" Analysis of voice signals there is another very important method This method is rarely used in the technical analysis of various trading markets, which is the "Spectrum" (Spectrum) analysis is also in the time region (TimeDomain) of the signal, through the FourierTransform (FourierTransform) to the signal to the frequency region (FrequencyDomain) using Fourier Transform ( The purpose of FourierTransform is usually to know the "substance" of the signal, that is, the "spectrum" (Spectrum) In the technical analysis of commodity trading, the "volume" (Volume) is usually used to represent the "substance" of the signal. Next, we enter the focus of this chapter, is the use of "technical indicators" before the introduction of several concepts of knowledge 1, to understand the market you want to operate: general beginners may feel that the field of commercial trading "TechnicalAnalysis" (TechnicalAnalysis) is a bunch of things related to the chart (Chart), so often ignore the market in the real "eyebrows corner corner" ( As Taiwans richest man, Kuo often says, "The devil is in the details" What are these details? In the case of currency markets, for example, the Australian dollar is often linked to the price of gold to a certain extent, while the US dollar is inversely linked to gold. Before using technical analysis, simple market knowledge must have a certain degree of understanding of simple concepts used in the currency market, such as when we know that the overall environment is bearish U.S. dollar, if the use of technical analysis to make more U.S. dollar must be "short" to grab the rally, because when the trend of the U.S. dollar is going down, the use of technical indicators to enter the market for more may have a higher risk II, the time frame and cycle: all technical analysis will use and reference? Time frame" (TimeFrame) required for each strategy, the time frame for technical analysis is a very important "knowledge ofChoice" (KnowledgeofChoice), for example, the trend of trading investors will choose a longer time frame, when the hedge trading investors will choose a shorter time frame, the thin trading investors will choose a shorter time frame The choice of time frame in the forex field is very much dependent on the trading platform that the investor chooses, but most trading platforms offer "one minute" (1M), "five minutes" (5M), "fifteen minutes" (15M), "thirty minutes" (30M), "one hour" (1H), "four hours" (4H), "daily" (Daily), "weekly" (Weekly), "monthly" (Monthly), and "monthly" (Monthly) time frames. Some forex brokers also provide TimeFrameChart in units of "Tick" Different TimeFrameChart has a great impact on the decision of technical indicators. Clearly, the above TimeFrameChart represents different Bar lines in different time units, for example, a "one minute" (1M) line chart means that the period of a Bar line is one minute, a "five minute" (5M) line chart means that the period of a Bar line is five minutes, for example, if a Bar line in a "one hour" (1H) line chart means that the period of a Bar line is five minutes. For example, if you see the high, low, opening and closing prices in the "one hour" (1H) time frame, this is the price information for each "hour" and so on. MultipleTimeFrame, MTF) as the name implies, MTF is any point in time, reference to multiple time frames on the trend line, and then the technical indicators for long and short decisions famous MTF CCI indicator is so in the implementation of the short term market in and out Three, volatility: the concept of volatility is very important in the stock market is most often called "stock lively" or "stock bull" In fact, it is "volatility" (Volatility) connotation in general in the stock market concept, "volatility" (Volatility) the higher the stock, the more speculative in the foreign exchange market is also the same in the foreign exchange market is the most famous highly volatile currency pair is GBP/JPY its volatility even up to a night more than 1000 points of amplitude, that is, just one lot ( So, if you put in money with a margin of $10,000, with a leverage of 1:100, you can lose all the money in your account in one night or make a profit of 100% on a highly volatile currency if you use indicators with severe delays, for example, the usual MA indicators, because of their slow response. On the other hand, the less volatile currencies do not like to use indicators with fast response, such as the FisherTransform indicator, because they react too fast and are easily fooled by the "FakeSignal" (FakeSignal). So of course most of the "trend operation" but the problem is, how will the investor know at any point in time, he saw the "trend" is about to happen, run to the middle, or has ended Most technical analysis in reference to "trend operation", are looking at the chart to tell the story, that is, the "historical plate" to explain the possible future direction, but "trend" concept in the entire field of technical analysis occupies The overwhelming position of technical analysis as the main reference for investment investors, must be the "trend" of observation in the first position V. Support and resistance: This term is most often seen on television and newspapers and magazines, financial stations or financial news in almost every commodity trading price analysis, and even the entire market will use "support" (Support) and "resistance" (Ressistance This "price concept block" can also be called "Buying-SellingZone", or "Accumulation-DistributionLevel", or "Supply-DemandLines", etc. DemandLines, etc. The general analysis is that when the market breaks through the "resistance" (Ressistance) point, regardless of whether the market is up or down, the original "resistance" (Ressistance) point will become the next level of "support" (Support) point Many market analysts use the "support and resistance" (S& R) to make predictions about future market price highs and lows Sixth, volume: "Momentum" (Momentum) in the stock market is very easy to get instant information The so-called "volume-price" refers to the price will be driven with the volume of the operation of the stock market, or the operation of futures technical analysts will certainly look at the "volume-price" relationship to make market judgments Generally used to measure the "volume-price" relationship of technical indicators is "Oscillator" (Oscillator). However, in the forex market, especially the retail forex market, there is no single forex broker that can provide complete and immediate "volume" information for the entire international forex market. Therefore, most of the technical analysis experts know very well that in the foreign exchange market, because the "volume information" is not complete, if only the "Oscillator" (Oscillator ) to measure the true "volume-price" relationship of a currency in the foreign exchange market, usually not very accurate For a novice who wants to enter the field of technical analysis of foreign exchange, first understand the above six technical analysis of the basic knowledge is a great help in the foreign exchange market, the use of "technical analysis" (TechnicalAnalysis) skills to make investment orders almost accounted for the majority of the method At the same time, even if I like to use "ArbitrageAnalysis" to make trading decisions, the prior condition is that I must know some "TechnicalAnalysis". (TechnicalAnalysis is a necessary evil for a professional investor to learn.