Most Profitable Forex Indicator

Welcome again to another article on our best forex indicator blog! Most Profitable Forex Indicator? Trading forex has never been easier than what we currently have. Prices of financial instruments are readily available than ever before. The forex market dates back so many decades. Throughout this history, several trading indicators have emerged to help traders analyze the market and thus make continuous profits. Since the Advent of forex indicators, traders can now predict what may happen next to align their strategies for profitability.

Advances in computing technology, coupled with internet penetration, and has significantly shaken things up. Nowadays, trading platforms are more user-friendly to maximize profits for users. This has revolutionized the world of trading indicators. Thus, there are tons of indicators on the market from which to choose. Tip: if you are looking for forex robots then you can check out our best ea forex page. With the flexibility of trading indicators, traders now determine market trends, measure market metrics, and even their indicator to suit their trading needs. Learning about the most profitable forex indicators can help you get better market analysis by customising them to ones trade strategies.

With a massive list of trading indicators, the search for the most profitable forex indicator is not out of place. In this article, we have done the hard job for you. We would be walking you through the top 5 profitable forex indicators of all time. These indicators have been tested to guarantee continuous profits.

Without further ado, let’s get started.

#1. Pattern recognition indicators

Pattern recognition indicators made it to the top due to its user-friendliness and uniqueness. When used with trending indicators, predicting future price movements just got easier. This indicator has a simple interface and helps to trim downtime on all the charts significantly.

Pattern recognition indicators also show candlestick patterns on the charts. With this indicator, your chances of succeeding as a forex trader are assured, gaining its spot as a trusted most profitable forex indicator. However, ensure you are trading on a reliable platform like MT4.

Pros

• In terms of reversal zones confirmations, this indicator stands very tall
• There is a provision for multiple entries post
• Enables you to make a profit faster and prevents you from losing money
• Pattern recognition indicator can also help to cut downtimes on all charts

Cons

• Pattern recognition indicator works with additional confirmations such as Harmonic Patterns, Fib Channel, Trendlines, Fib Retracements, and Pitchforks, among others.
• You have got to learn lots of demos before mastering the indicator
• You have to be live on charts; otherwise, it is imminent to lose money consistently.

#2. Moving Average

Do you want to determine the forex market trends to know whether to invest your hard-earned money or not? Then consider using moving averages. Moving average indicators is an all time favorite in forex trade and one of the most profitable forex indicator. This tool is potent and amazing. Most traders that you know or see that are making money are probably using moving averages. You can use the MA(Moving Average) also with a live currency strength meter.

There are four types of moving averages; you can use them individually or jointly to achieve robust trading strategies. The following are the four types of moving averages:

• Simple moving averages
• Exponential moving averages
• Weighted moving averages
• Smoothed moving averages

One can use moving averages to determine the exchange rate – high, low, open, or close. What’s more? The close is the most popular. Moving averages can be calculated by summing up the exchange rates over a given time and then divide the result with the number of periods. After the calculation, if the moving average lies above the exchange rate, a bearish signal would be sent to the trader. However, if the moving average lies below the exchange rate, a bullish signal would be sent to the trader.

Pros

• A moving average helps to identify the current trend directions quickly
• It shows resistance levels and potential support
• Moving average can also help you find trend reversals.

Cons

The only noticeable drawback with this indicator is that they are lagging indicators and should always be paired with oscillating indicators for effectiveness.

#3. Bollinger Bands

Bollinger Bands are fantastic forex indicators to behold if you want to measure market volatility. There are times when the market trend is not clear enough for traders to understand; this tool will help out.

Bollinger Bands work by selling a currency pair when the price is above the indicator’s upper line and buying when the price is below the indicator’s lower border. Bollinger Bands was developed in the 1980s by John Bollinger.

Pros

Can easily measure market volatility

• It is more effective the moment a currency pair is traded in its range in a parallel market.

Cons

If market trends are strong, this indicator might become stagnant at one Bollinger band.

#4. RSI (Relative Strength Index)

It was J. Welles Wilder who developed RSI in 1978. It is a useful forex indicator for traders to determine market trends and price changes. It is usually computed by comparing a currency pair amount with the most recent exchange rate increases to that of its most current exchange rate drops. The time period parameter can be adjusted; most traders prefer to use the default 14 periods. The value of RSI usually fluctuates between 0 and 100. A trusted indicator to savvy traders and are one of the most profitable forex indicators for mt4. The RSI Indicator works great with the price action indicator mt4.

Pros

This indicator is useful in both ranging and trending markets

• Determining price changes just got more comfortable with this indicator
• It is user-friendly and comes with an excellent interface

Cons

It doesn’t follow a strong market move and because of this signals may arrive late

• It only works best in an oscillating market

#5. Moving Average Convergence Divergence (MACD)

The Moving Average Convergence Divergence (MACD) forex indicator was developed by Gerald Appel to solve the problem of guesswork that most newbie traders battle with and is considered as one the most profitable forex indicator. It is unbounded and generally appears below the price action. Its time scale is the same as that of the exchange rate chart. The MACD uses the difference between two weighted moving averages and includes a smoothed moving average line.

Pros

MACD measures market trends and momentum

• It could strengthen your trading strategies and enhance your skills

Conclusion Most Profitable Forex Indicator?

Forex Indicators are must-haves if you want to trade forex as an expert. Before settling for a forex indicator as a beginner, ensure you understand how it works using a demo account.

This way, you would be able to understand how to use the indicator to enhance your trading skills. The five most profitable forex indicators we have listed have been tested to be profitable and performance-driven.

And if you are looking for further enhancement in your performance as a trader, you could drive towards trying working more ways through this link.