If you use a carry strategy, an additional signal is any change in interest rates. Cable (EUR/USD) during the Greece crisis is a good illustration for this idea. If you have any reason to expect a major adjustment and the market hasn’t yet reflected it, this is an obvious reason for entry. One is something you should be doing anyway-watching news shocks. There are several other possibilities for entry signals. Buy on the bottom of one of these short trends so that you can profit from the larger trend. In other words, once you are convinced of a trend, wait for a short term retracement to begin-usually 3-4 candles. If you use price candles or a retracement method, you should also make this part of your decision. Use 200 EMA and see if the trend line intersects with this indicator at any point. And yet another indicator is exponential moving average. You should also see if you can find points of resistance or support.

Trace daily pivot points, drawing a horizontal trend line.

Similarly, you can also look at momentum indicators such as the TRIX indicator, relative strength, or smoothed rate of change.Īnother way to establish trends is with Fibonacci analysis. Look for a number somewhere around 30-40. The average directional index (ADX) or moving average convergence/divergence (MACD) is a statistical way of measuring whether a trend is significant. However, to confirm the trend, you should look at another indicator. Of course, a downward trend only works in reverse-the short-term average crosses from above. If the short-term average crosses the long-term from below, you can reasonably say that an upward trend is coming. Here’s the concept: if you use the moving average for the long-term and another average for the short-term, you have a nice basis for comparison. One excellent way to look for forex entry signals is with crossover in moving averages. More forex trading strategies Perfect conditions for the entry How do you know when to enter and exit? In this article we will focus only on one side of the equation, finding a list of conditions you should look for before making an entry. Almost everything boils down to choosing the right currency pair, entering the market at the right time, and knowing when to exit.

With all of the complexity in forex trading, there is a very simple way to describe success.

Best forex indicators that work