Now, let's have a look at the most important indicators for intraday trading.
Top Indicators for Intraday Trading
We have conducted a list featuring all major technical indicators for the short-term trading strategy. They are as follows:
1. Moving Averages
Even if you are new to the financial market, you have probably heard about this particular indicator. Beginners and pros commonly use it as an essential element of their technical analysis. The method involves placing the average closing rates on a separate stock chart that contains a line associated with a specific period. Let's say, you trade a stock.
The chart depicts a stock movement at a long timeframe, which often means a more reliable moving average. Besides, this indicator makes it possible to apprehend the possible asset movement because stocks are pretty volatile.
2. Bollinger Bands
This indicator for intraday trading is a bit more advanced and complicated if compared to moving averages. It also uses trading charts with three different lines and the average closing rates depicted in the chart. The main idea is to show how the price can go upper or lower from its average.
3. Momentum Oscillators
If you decide to trade stocks, market volatility is the first thing you need to keep in mind. In other words, stock prices never stop moving up and down. This is where the best technical indicators for intraday trading will let you easily keep up with that movement.
Momentum oscillators are the only indicators that make it possible to determine the moment when stock markets are experiencing a short-term cycle no matter if it is being bearish or bullish at the moment. The indicator lets traders identify this particular scenario and decide if the market is going to experience some rapid changes in the nearest future.
4. Relative Strength Index (RSI)
A trader uses the RSI indicator when the task is to compare the share's price losses and gains. The necessary data is delivered in the form of an index that comes with the RSI scoring rate. It ranges from 0 to 100. Experts say that if the rate goes up to 70, it is the best moment to buy stocks.
If it goes down to 30, you are supposed to sell stocks. But you should avoid considering this particular concept as a rule. The best way is to do in-depth research and analysis of your own in advance.
5. Moving Average Convergence Divergence (MACD)
The last point in our list of best indicators for intraday trading is the MACD indicator. Traders generally use it to retrieve the information about the potential trend's movement. Besides, it shows the trend's movement duration and momentum.
The indicator uses two moving averages at the same time. They are divergent and convergent. If MACD comes up with a positive value, it means that the trend is likely to move upwards. If the value is negative, we are to expect a trend moving downwards.
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