What's Inertia Indicator? - Definition of Inertia Indicator
Inertia indicator - Inertia technical indicators is a popular forex indicator which can be found on the - FX Indicators List on this website. Inertia indicator is used by traders to forecast price movement based on the chart price analysis done using this Inertia indicator. Traders can use the Inertia buy and Sell Signals explained below to determine when to open a buy or sell trade when using this Inertia indicator. By using Inertia and other forex indicators combinations traders can learn how to make decisions about market entry & market exit.
What's Inertia Indicator? Inertia Indicator
How Do You Combine Forex Indicators with Inertia? - Adding Inertia Indicator in MT4
Which Indicator is the Best to Combine with Inertia?
Which is the best Inertia indicator combination for forex trading?
Most popular indicators combined with Inertia are:
- Relative Strength Index
- MAs Indicator
- MACD
- Bollinger ##BandsBand
- Stochastic
- Ichimoku Kinko Hyo Indicator
- Parabolic SAR
Which is the best Inertia indicator combination for Forex trading? - Inertia MT4 indicators
What Indicators to Combine with Inertia?
Find additional indicators in addition to Inertia indicator which will determine the trend of the market as well as others that confirm the market trend. By combining forex indicators that determine trend & others that confirm the trend & combining these indicators with Forex Inertia indicator a trader will come up with a Inertia based system that they can test using a practice demo account on the MetaTrader 4 platform.
This Inertia based system will also help traders to determine when there is a market reversal based on the indicators signals generated and therefore trades can know when to exit the market if they have open trade transactions.
What is Inertia Indicator Based Trading? Indicator based system to analyze price & provide trading signals.
What's the Best Inertia Strategy?
How to Choose the Best Inertia Strategy
For traders researching on What is the best Inertia strategy - the following learn forex tutorials will help traders on the steps required to tutorial them with coming up with the best strategy for trading forex market based on the Inertia indicator system.
How to Create Inertia Strategies
- What is Inertia Indicator System
- Creating Inertia System Template
- Writing Inertia System Rules
- Generating Inertia Buy and Inertia Sell Signals
- Creating Inertia Indicator Forex Trading System Tips
About Inertia Indicator Described
Inertia Analysis & Inertia Signals
Created by Donald Dorsey and was originally used to trade Stocks & Commodities market, before fx traders took it & started trading the market using this trading indicator.
Dorsey chose to name it "Inertia" because of his interpretation of the market trend. He claimed that a market trend is the overall result of inertia and thus it takes more momentum for a trending market to reverse its direction than to continue moving in the same direction. Hence, a trend is the measurement of market inertia. This is an oscillator that uses the scale of zero to a hundred. Signals are generated using the 50 level center line crossover method.
In physics, the term Inertia is defined in terms of mass and direction of motion. Using the standard technical analysis, the direction of motion of the trend can be easily defined. However, the mass cannot be easily defined. Dorsey claimed that the volatility of a financial instrument may be the simplest and the most accurate measurement of inertia. This theory led to the use of the Relative Volatility Index (RVI) as the basis to be used as a trend indicator. Hence Inertia indicator is comprised of: RVI smoothed by a linear regression.
FX Analysis & Generating Signals
In trading the currency market using this trading indicator, the signals generated are fairly simple to interpret. Below are 2 examples illustrated using forex charts showing how buy & sell signals are generated using Inertia.
Upward Trend - Bullish Buy Signal
If the Inertia is above 50, positive inertia is indicated, this therefore defines the long term trend as upward as long as the indicator remains above 50. When it crosses to levels below 50 then this is interpreted as an exit signal. The chart below shows an example of how a buy signal is generated.
Up-wards Trend - Bullish Signal
Downwards Trading Trend - Bearish Sell Trading Signal
If the Inertia is below 50, negative inertia is indicated, this therefore defines the long term trend as downwards as long as the indicator remains below 50. If it goes above 50 then this is interpreted as an exit signal. The currency chart below shows how a sell signal generated.
Downwards Trend - Bearish Signal
