Best indicator for trading in stock market
Best indicator for trading :
* MACD
* Parabolic SAR
* Momentum
* Bollinger Bands
* Stochastic oscillator
* Fibonacci retracement
MACD:
"Moving average Convergence Divergence" The MACD turns two trend-following indicators, moving averages, into a momentum oscillator. MACD offers the best of both worlds: trend following and momentum. The MACD fluctuates above and below the zero line as the moving averages converge, cross and diverge.
The MACD is all about the convergence and divergence of the two moving averages. The shorter moving average (12-day) is faster and responsible for most MACD movements. The longer moving average (26-day) is slower and less reactive to price changes in the underlying security. MACD is all about the convergence and divergence of the two moving averages.
Signal line crossovers are the most common MACD signals. The signal line is a 9-day EMA of the MACD Line. As a moving average of the indicator, it trails the MACD and makes it easier to spot MACD turns. A bullish crossover occurs when the MACD turns up and crosses above the signal line. A bearish crossover occurs when the MACD turns down and crosses below the signal line. Crossovers can last a few days or a few weeks, it all depends on the strength of the move.
These can be used to get positions..When the MACD line cuts the signal line from under it to go above, its a sign to buy, when the oposite happens when the MACD line cuts the signal line from able it to go below it, its a signal to sell. simple yet effective
parabolic sar:
In stock market and forex market technical analysis, parabolic SAR is a method devised by J. Welles Wilder, Jr., to find potential reversals in the market price direction of traded goods such as securities or currency exchanges such as forex.
Momentum :
A momentum indicator (oscillator) is a technical indicator its shows the trend direction and measures the pace of the price fluctuation by comparing current and past values. It is one of the leading indicators that measure the rate of change of securities.
Bollinger bands :
Bollinger Bands are envelopes plotted at a standard deviation level above and below a simple moving average of the price Bollinger bands help determine whether prices are high or low on a relative basis. They are used in pairs, both upper and lower bands and in conjunction with a moving average.
Stochastic oscillator :
In technical analysis of stock trading, the stochastic oscillator is a momentum indicator that uses support and resistance levels. George Lane developed this indicator in the late 1950s. The term stochastic refers to the point of a current price in relation to its price range over a period of time.
Fibonacci retracement :
Fibonacci retracement levels are horizontal lines that indicate where support and resistance are likely to occur. ... The Fibonacci retracement levels are 23.6%, 38.2%, 61.8%, and 78.6%. While not officially a Fibonacci ratio, 50% is also used.