Five indicators for trading on the stock market

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These indicators are characterized above all because they almost never guarantee total success in operations, but they do so unless decisions on the stock market are made under more objective and reliable criteria. Because among other reasons they give more clues than small and medium investors can expect from the beginning. To the extent that at some price levels it may entry or exit positions of any financial asset and that are of great help for decisions in the different financial markets.

From this general approach, there is no doubt that these indicators that we are going to talk about now are more than information. If not, on the contrary, they are investment instruments whose main contribution lies in detecting trend changes para tener acceso o salir de los mercados financieros. No en vano, este es su principal e inclusive se puede decir que es su único target. Is he value added que puede aportarle desde cualquier tipo de strategy de inversión.

Not surprisingly, you can use them every time you go to make your money profitable in the main financial assets. Not only in the purchase and sale of shares on the stock market, but in other types of shares alternative investments. As an example, raw materials, precious metals and the most popular currency market. Therefore, you have before you a new source to give something more solidity to your investments. Regardless of the model you select from these precise moments.

Indicators to develop strategies

There are no secret recipes to earn money on the stock market. But one of the tools investors have to operate in equity markets are technical indicators. Not only to execute purchase orders, but to know when is the most opportune moment to exit the financial markets. The only downside to their application is that they require a very deep knowledge that necessarily goes through an apprenticeship in technical analysis. From this dynamics, the movements are adjusted according to the trend presented by the selected values.

Making an investment strategy based on technical indicators does not guarantee any success in operations. But it will definitely improve expectations substantially, so saving can be more than just a wish. Regardless, the class of indicators it is practically unlimited y de todo tipo. Sea cual sea el caso, para no abusar de este tipo de parámetros bursátiles, la mejor solución pasa por importar los más relevantes que se puedan usar con mayor facilidad en inversión. En particular, aquellas que detectan la tendencia o fuerza de las cotizaciones.

Average cell phone: the most used

Por su sencillez, la media teléfono celular es una de las más usadas por inversores menos experimentados. No en vano, es alcanzable para prácticamente todos los perfiles de Username debido a que se basa en tomar posiciones cuando el precio de las acciones supera la media. Como en el movimiento opuesto, dicho de otra forma, exit the market when prices are below that level. At the same time, it considers an important advantage over other indicators and that is that it is a valid system to operate in any market trend.

A little more complicated, but on the contrary very effective, is the MACD (convergence or divergence of the average cell phone). Exactly because of its reliability to follow a trend, whatever it may be. Even when its best result is generated by the change of direction of a security, sector or index in the financial markets. Its practicality lies in the fact that the divergences shown on the charts can be led to buy or trade depending on whether they are positive or negative, respectively. In the same way as in the previous indicator, when the MACD crosses the reference signal it is a warning to open bullish positions, while if it crosses it below it will be to trade.

Relative strength

Another technical indicator that should not be missing on any investor's chart is the so-called RSI (Relative Strength Index). Mainly because it is very valuable to measure the price force of the selected financial assets. From this perspective, it is a very effective tool to verify the degree of validity of the rises or falls of the stock market. The ease of detecting it makes it one of the most accessible references for users. Its mechanics are based on the fact that as the closings are higher, the value of this indicator will increase and vice versa. To the point of discovering whether a security is overbought (above 70) or oversold (below 30).

Within this list, the ADX indicator (strength of directional movement) should not be missing on any investor's agenda. Especially since it is tied to the power of a trend, whatever it is at the time. Not unlike your address which is open to other types of indicators. It is an extremely simple procedure to interpret given that, if, as an example, the price of a security rises and the ADX falls, there is no other translation than the uptrend is very relevant. Quite the opposite of the opposite scenario. By not addressing the trend, it is primarily targeting merchants that operate with all types of financial products: stocks, futures or derivatives.

The famous stochastic

On the other hand, the stochastic also stands out, which is characterized by forming a quote linked to its maximum and minimum price. It is formed by two lines that intersect under ranges that usually oscillate between levels 20 and 80. So if they approach these parameters they will be inviting to replicate them with a buy or sell order, respectively.

They do not guarantee total success in operations, but they do so unless decisions in the stock market are made under more objective and reliable criteria.

It cannot be forgotten that the stochastic is one of most followed figure by any experienced investor worth his salt. Beyond other technical considerations and perhaps also from the point of view of fundamental analysis. From this approach to investing, there is no doubt that the stochastic is a very reliable figure above all else. As we might expect, you almost always anticipate the moves that stocks, sectors, and stock indices are going to take. Serving of great help to carry out any type of investment strategy. That is what it is all about, after all, as you yourself will know well through the operations carried out under this very effective system.

Advantages in its use

On the other hand, it is undeniable that the contribution of these indicators that we have shown you and other similar ones is very important for the correct development of investments. Not only because it will improve trading performance, but also because it will protect investors from worst-case scenarios for equity markets. In this regard, the benefits that you can find from now on with these important stock market indicators are diverse and diverse in nature. As an example the ones we point out below:

• They can give you powerful signals about the values in which you must invest your savings and on the contrary those that you must avoid at all costs. In this aspect, it is a very selective filter to start any type of stock exchange operation.
• With a little learning you will be able use these tools with great efficiency. So that from this dynamic, the profitability of your savings increases. Not without a bit of effort until you can debug this technique and are a perfect expert in its correct application.
• Do not doubt that it will help you to realize safer operations, from all points of view. Where the money you invest will be more protected against possible adversities in the financial markets and that will undoubtedly appear at any time in your life as a small and medium investor.
• Using this investment strategy you can expand operations to other sectors that perhaps until now you had not thought about taking positions in them. Ultimately, the business possibilities will expand beyond other technical considerations.

Conclusions on these indicators

In conclusion, you should not forget that these indicators are especially a clear support of what you should do in the financial markets. Neither more nor less, because at the end of the day it is its purpose. On the other hand, it is also necessary that you know that it is not an infallible system and at one time or another it can generate an obstacle when carrying out operations on any financial asset. It is much better that you complement it with other investment systems so that the guarantees are much clearer. So that in the end you are the beneficiary of the movements you make in the financial markets.