ADX with Stochastic:
ADX: define trend force, whether the trend will develop further or will gradually weaken.
Three lines in ADX:
1) +DI (Yellow)
2) -DI (Red)
3) ADX line (Blue)
Stochastic: compares a stock's closing price to its price range over a given period of time.
Using the both will give traders great forecasting trend strength.
Two lines in Stochastic:
1) %K: This is the number of time periods used in the stochastic calculation.
2) %D: This is the number of time periods used when calculating the moving average of %K.
Signal to buy:
When either %K or %D falls below the line, and then again crosses the bottom level upwards or when the curve %K crosses the curve %D from below upward.
When +DI is higher than -DI
Signal to sell:
When oscillator grows above the line, and then crosses the top level downwards or when the curve %K crosses a curve %D from top to downward.
When +DI is lower than –DI
A Journey to Master Forex Trading (FX Trader from Singapore)
Sunday, December 7, 2008
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