Indicator Combination - Stochastic Oscillator, MAs, RSI and MACD Indicators.
Best combination of indicators PDF - Stochastic Oscillator indicator, MAs indicator, RSI indicator and MACD indicator
Stochastic indicator can be combined with other indicators to form a strategy - Buy Sell Signal Indicator MT4 Indicators. For our examples we will combine it with:
- RSI
- MACD indicator
- MAs Indicator
Indicator Combination Example 1:
Sell Signal - Combination of Indicators for Swing Forex Trading
From our strategy the sell trading signal gets generated when:
- Both Moving Averages are moving down
- RSI indicator is below 50
- Stochastic moving downward
- MACD indicator heading downward below centerline
The sell signal was generated when all these forex rules were met. The exit signal is given when a signal in the opposite trend direction is generated i.e. When the indicators reverse.
Good thing about using such a strategy is that we are using different types of technical indicators to confirm trade signals and avoid as many whipsaws as possible in the process.
- Stochastic - is a momentum oscillator
- RSI- is a momentum oscillator
- Moving Averages Indicator- is a trend following indicator
- MACD indicator- is a trend following fx indicator
It is very useful to combine more than one forex indicator, as a combination of signals is better than relying on just a single forex indicator. The forex indicator combinations reinforce each other, and cancel out false whip saw fake-out signals.
A trend following indicator helps one to see the overall picture, while using more than one momentum indicator gives better & more reliable entry & exit points for trading.
Best combination of technical indicators & their signals help to analyze a lot of the market activity.
Example 2:
Buy Forex Signal - Combination of Indicators for Swing Trading - Best Indicator Combination
For this trading indicator combination example the market trend is upward, but at some point there were a few false signals - whipsaws generated by the stochastic oscillator indicator - So the question is how can a trader avoid these forex whipsaws?
The answer is by combining other indicators such as MACD, RSI Indicator and Moving Averages a trader could have avoided the whipsaws, as shown on example above MACD indicator had not given a crossover signal although it was very close to the zero center-line mark, at the same time the momentum at which the moving averages indicators turned wasn't decisive so as to signal a decisive forex trend reversal.
As long as MACD indicator is above zero center line mark even if the MACD indicator lines are heading downwards then the trend is still upwards. As you can see from the above forex indicator combination example MACD indicator never went below zero line mark and afterwards the upward trend continued with the MACD indicator maintaining above Zero Centerline & continuing to move upward.
Duringrange bound sideways trends Stochastic Indicator will give the fastest signals which are prone to whipsaws and this is why stochastic oscillator technical indicator is best combined with other indicators & signals which are generated are confirmed using other indicators to form - Best Leading Indicator Trend Indicator & Momentum Technical Indicator Combination - Combination of Indicators for Swing Trading - Indicator Combination - Best Indicators for Strategies.
