Monthly Archives: December 2017

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Trading signals: from indicators to algorithms

Category : Uncategorized

How do you make a decision to buy or sell a financial asset? Probably, you have an algorithm that helps you make the right choice, haven’t you? That strategy, which indicates the time of entering the market, what volume you need to enter the transaction, and also how long to hold it. To put it simply, the trading strategy should tell you where exactly you need to open a long position, and where to open a short one. Usually,these “instructions” are called trading signals.

Trading signals are the final filters in the trading strategy that indicate the triggering of all necessary conditions in your trading strategy and notify you of the best investment opportunities. They can be implemented with the help of alerts, warning systems to the mobile device or special programs.

Trading signals, as I wrote above, can be realized with the help of automatic systems. If your trading strategy is based on technical indicators, itwill not be very difficult to realize the signal in the form of an automatic panel. In that case, all the signals of the fix api trader will be displaied in one place and if desired he can filter them for reliability based on the current trend.

Panels for displaying signals are very popular today in the market, because it allows you to look at it and in a matter of a few seconds to understand what is the situation on the market and where to open deals. There is also a possibility of automatic operation of some panels. Thus, they will work as trading robots, making trading operations in the fix apiforex market without additional intervention of the trader.

However, in order to compose a trading panel or form an effective methodology for a trading strategy, you should know what trading signals exist, with what tools they are identified and how they should be interpreted for effective trading.

For this purpose,I propose you to review several key trading signals that the absolute majority of players use in their fix api trading:

  • Reversal signals. As a rule, this group is formed with the help of patterns to which both reversal bars and combinations in the form of harami can refer http://www.onlinetradingconcepts.com/TechnicalAnalysis/Candlesticks/Harami.html). I recommend these signals to be taken into account when opening deals with a minimum amount. If after the opening the deals on the basis of reversal combinations, other signals are generated that confirm their dynamics, it is possible to search for additional signals for entering the market.
  • Divergence. Quite a popular trading signal, which helps the manager to determine correctional zones within the trend, in order to fix profits and in the future to re-open the position. This signal is formed on the basis of the indicator’s values (the main ones are: MACD, Awesome Oscillator, RSI), as well as the quotes of the asset. So, if the quotes increase, and the indicator’svalue decreases, then this is a signal to possible correction down. If, on the contrary, the quotations are reduced and the indicator’svalue grows, we should expect correction upwards.
  • Level breakdown. Breakdown is one of the strategies for working in the fix apiforex market using level analysis. This signal indicates the trader that the market is set to follow the trend and also goes into a new phase. Therefore, with such signals, I recommend you to find another 2-3 signals confirming the trend and enter when the breakdown of the local maximum/minimum or fractal zone is repeated (http://www.traderslaboratory.com/forums/forex/19287-trading-forex-fractal-strategies.html).
  • Signals from the indicators. Here, you can list a lot of different combinations and groups of indicators. But I think you can cope with this task independently checking the Internet. I isolated these signals in a separate block, since they can be the same confirming filters for other trading signals.

Undoubtedly, it is impossible to unite all the trading signals that I brought above into a single trading strategy. However, if you can expand your strategy by logical continuation in the form of data for trading signals, this will enable you to avoid false entries into the market and increase the investment capital.


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Oscillators in trading: what you can expect of them

Category : Strategy

The assets analysis in the financial market can consist of almost any instrument of both a technical and a fundamental approach. The trading strategy helps us determine what kind of approach (patterns, news or indicator) should be used, as every api fix trader has his own trading strategy. But to improve the very process of analysis, today, a huge amount of auxiliary software has been created. The world of automation made it possible to apply various methods and algorithmize the trading process, as a result of which the analysis toolkit expanded.

According to the US Bureau of Statistics, most traders conduct their trading using technical elements, as well as trading robots based on the HFT trading, i.e. high-frequency speculative algorithms, which include fix api arbitration techniques –http://forexzzz.com/product/forex-zzz-lock-arbitrage/. With regard to the use of technical elements, one of the most popular is the use of a group of oscillator indicators.

Oscillators are a group of technical indicators that allow the trader to receive a series of signals about the current state of the market. By identifying the overbought and oversold zones, the manager can fix open trade transactions and with the help of trend reversal signals, to enter the market at the very beginning of his movement.

In order to more fully understand the principle of trading indicators from a group of oscillators, I propose to examine in more details the tradesignals they demonstrate:

  • Oversold zone: it signals to the trader that the quotes have already declined sufficiently and further sales are unlikely. If this signal falls on the achievement of local minima, then this will be a confirmatory filter that it is worth to limit your open positions.
  • Overbought zone: it gives a signal that the quotes on the contrary have already grown sufficiently and their further growth is limited. Similarly, if the quotes are at the local maximum or resistance level at that moment, then they are additional filters that indicate a decrease in currency pairs in the fix apiforex market. I recommend you to use overbought and oversold zones as an exit filter from the open positions, but not as a signal to action.
  • Signals to the trend reversal are carried out by means of divergence, which indicates the divergence or convergence of price quotations with the value of the technical indicator. That is, when the quotes of the financial asset decrease, and the oscillator value grows, this will be a signal to turn and it is worth to expect the asset to move towards the indicator. Similarly, when the quotes increase, and the indicator shows a downward trend, then we should expect the trend to turn into a decline.

Considering the fact that now we know all the signals that arise due to the use of oscillators, we can more accurately enter the market and expand our trading strategy with these elements. However, these signals do not appear to absolutely all indicators, but each signal appears to certain indicators. Therefore, they can also be divided into two groups following the nature of the trading signals formation for fix api trading:

  1. Overbought and oversold zones: RSI, MFI, Stochastic.
  2. Divergence: Awesome Oscillator, MACD (http://forexrobotshub.com/2017/09/26/technical-indicator-macd-use/).

Personally, I use the Awesome Oscillator in my trading to find possible correlation zones by triggering a divergence. Also, this indicator allows you to receive additional trading signals due to its histogram form. Thus, the third directed histogram in a row indicates the purchase or sale of the financial asset of the fix apiforex market, depending on the current position of the indicator itself.

I hope that today’s small review will help you to choose a working tool that you can use in your trading strategy or expand the list of filters to make the final decision.

 

 


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