Experienced traders know how important it is to use indicators. Beginners, for sure, have heard this word, and we will explain what it is and how to use it.
An indicator represents a graph. It is based on a mathematical analysis of prices in the market for a selected period of time. Typically, the indicator calculations take into account the open and close prices, maximum and minimum rates, etc. You can also analyze the graph of another indicator.
Traders need indicators to be oriented to the price movements and also inform about the entrance of the prices to the certain areas. In some cases, indicators can be used to locate these areas.
Due to MT4, a trader does not need to calculate anything – the program has the built-in indicators that can be opened using simple commands. To do it, you only need to refer to the menu "Insert" and click on the line "Indicators". You can also press the button on the control panel.
MetaTrader4 with 5 groups of indicators is seen at the picture below in the middle column.
Trend indicators recognize market trends and show the price direction. If the market is flat (without a trend), these indicators will not show any valuable information.
Oscillators show the price deviations from the market average. Group of these indicators allows you to prepare for the moment of fluctuation and price adjustments.
Volume indicators take into account a number of the prices changes during a specific period of time.
Indicators by Bill Williams are an integral part of the trading system.
Custom indicators accumulate the direction of the market movements, and also show market reversals.
After selecting the desired indicator in the appeared window, you can choose the display format.
Along with this, MetaTrader4 allows you to display the indicator on the chart or show it in a separate window. Editing a graph is as simple as its building. You just need to right-click the mouse on the indicator and select the desired menu item as shown below.
After completing the previous step, you will have an access to the following functions:
- Properties. Clicking on this bar you will see a special window where you can edit the properties of the indicator;
- Remove the indicator. Using this menu item you can delete a specific indicator (the window remains empty);
- Remove the indicator window. Clicking on this button the window of the indicator will be removed;
- The list of indicators. This function will help to open a window where you can see a list of all indicators placed on the chart.
Traders actively use indicators in their trading because they significantly increase the chances to profit. Trading by the indicator signals is much easier in terms of creating a profitable trading strategy than during manual monitoring of the market.