This video discusses four Forex indicators, including the Moving Average, Bollinger Bands, MA Crossover, and MACD, with examples of how to use them in trading, along with exit indicators. The video also includes a sponsored message from BlackBull Markets, a broker based in New Zealand, and the indicators’ profitability over the last three years.

The Best Forex Indicators for Profitable Trading

Introduction

As a trader, finding the best indicators to use can be a daunting task. There are countless indicators and strategies available online, making it difficult to know which ones to use. However, in this article, we will provide you with the best Forex indicators that you can use to make profitable trades. Our first indicator is the Moving Average.

Moving Average Indicator

The Moving Average is a simple indicator that can be underestimated. However, when used correctly, it can be very profitable. A simple Moving Average with a period of 9 represents the average price for the last 9 bars. If the current bar is above the 9 Moving Average, it means that the current price is higher than the average price for the last 9 bars.

Example Strategy using Moving Average

To use this indicator for a profitable strategy, we will open a long trade whenever the price crosses the 9 Moving Average upwards. In other words, we need to see one bar that opens above Moving Average after opening below it. To visualize this over the chart, we need to see one bar below the red Moving Average. When we have another bar that opens above the Moving Average, that is a clear confirmation that the price crossed the Moving Average.

We can also use Bollinger Bands as a confirmation to the Moving Average with the rule that the bar opens above lower band after opening below it with a period of 19 and deviation of 1.9.

Profitable Trade Backtest Example

With the above strategy, you can see a profitable trade with the backtest of the strategy. As well, we have the Bollinger Bands as a confirmation. We will be buying only when the price is at the lower band of the Bollinger Bands, and the very same thing applies on the opposite side. If you go for a short trade, it is essential to consider the stop-loss and take-profit values. Our stop loss is 35 pips, and take profit is 90 pips, reliable risk-reward ratio. As an exit condition, we can use envelopes if we see a bar that opens below the upper band after opening above it, with a period of 41 and deviation of 40.

Moving Average Crossover Indicator

The Moving Average Crossover is another fantastic indicator for traders. It uses two Moving Averages with different periods that cross each other to solve the problem that can occur when using just one Moving Average. When the market moves sideways, the price goes above and below the MA many times, affecting your trades’ profitability. That is where two Moving Averages with different periods that cross each other come in.

Example Strategy using Moving Average Crossover

To use this indicator for profitable trading, whenever the fast Moving Average crosses the slow Moving Average upwards, we have a long entry. However, we need to combine and confirm it with the Stochastic, which should be lower than the level line. For instance, with fast MA 11 and Slow 28, at the opening of the next bar we have a long entry and the Stochastic is below the level line. With that strategy, use a Stop Loss of 61 Pips, and Take Profit of 53 Pips.

When building a profitable strategy, it is crucial to pay attention to exit indicators. In this case, we use two exit indicators, envelopes, and Bollinger Bands, which will give us a clear signal to exit a trade. With envelopes, if the bar opens above the upper band, period of 20, and deviation of 0.5, it will be an exit signal. With Bollinger Bands, the bar opens below the lower band after opening above it, making it an exit signal.

MACD Indicator

The Moving Average Convergence, Divergence (MACD) is displayed with a MACD line, a signal line, and the bars around the 0 lines. The bars represent the difference between the MACD and the signal line. Hence, when the MACD line crosses the signal line, the bars are at 0.

Example Strategy using MACD

To use this indicator for profitable trades, we can utilize the MACD line crossing the signal line. The signal line should also be below the level line. This will indicate a long entry. For a short entry, we wait for the MACD line to cross the signal line downwards, and the signal line is above the level line.

Conclusion

In conclusion, we have provided you with the best Forex indicators that you can use to make profitable trades. The Moving Average, Moving Average Crossover, and MACD are all useful indicators that you can download for free. We have demonstrated through examples how to use each indicator and provided strategies that can help you in your trading. Remember to always set stop losses and take profits when trading, and use exit indicators to avoid unnecessary losses. Happy Trading!