Balance of Power Indicator Technical Analysis and Indicator Trading Signals

Balance of Power Indicator MetaTrader 4 Indicators Technical Analysis measures the strength of the bulls versus the bears by assessing the ability of each to push price to extreme levels.

Balance of Power Indicator MetaTrader 4 Technical Indicators Technical Analysis

Balance of Power Indicator MetaTrader 4 Indicators Technical Analysis Signals

When using this Balance of market Power indicator, zero line cross overs are used to generate Forex signals.

Center is marked as a zero line, areas oscillating above or below are used to generate trading signals.

Buy - The scale is marked from Zero to +100 for bullish market movements

Sell - The scale is marked from Zero to -100 for bearish market movements

How to Generate Buy and Sell Signals with Balance of Power MetaTrader 4 Indicator

Buy Signal

When the BOP crosses above zero a buy signal is given.

Also when Balance of Power Technical Indicator MetaTrader 4 Indicators Technical Analysis is rising, the market is in an upward trend, some traders use this as a buy signal but it is best to wait for the confirmation by moving above the zero mark. As this will be a buy signal in bearish territory & this type of trading signal is more likely to be a whipsaw.

Sell Signal

When the BOP crosses below zero a sell signal is given.

Also when Balance of Power Technical Indicator MetaTrader 4 Indicators Technical Analysis is declining, the market is in a downward trend, some traders use this as a sell signal but it is best to wait for a confirmation by moving below the zero mark because this will be a sell signal in bullish territory and this type of trading signal is more likely to be a whipsaw.

Sell and Buy Signals - Balance of Power Indicator MetaTrader 4 Technical Indicators Technical Analysis

Forex Trading Divergence FX Trading

In forex trading, divergences between the Balance of Power Indicator MetaTrader 4 Indicators Technical Analysis and price can be used to effectively identifying potential reversal &/or trend continuation points in currency movement. There are several types of divergences:

Balance of Power Indicator MetaTrader 4 Indicators Technical Analysis Classic Divergence - Trend reversal signal

Balance of Power Indicator MetaTrader 4 Indicators Technical Analysis Hidden Divergence - Trend continuation

Trading Overbought Oversold Conditions with Balance of Power Indicator MetaTrader 4

This Balance of Power Indicator MetaTrader 4 Indicators Technical Analysis can be used to identify potentially overbought and oversold conditions in price movement.

• Balance of Power Indicator MetaTrader 4 Indicators Technical Analysis Overbought/Oversold levels can be used to provide an early warning for potential trend reversals.
• These levels are generated when indicator clusters its tops & bottoms thus setting up the overbought & oversold levels around those values.

However, price may also stay at these over bought and oversold levels and continue moving in that direction for a while and thus its always good to wait until the Balance of Power Indicator MetaTrader 4 Indicators Technical Analysis crosses over the Zero mark.

From the example below, even though the Balance of Power Indicator MetaTrader 4 Indicators Technical Analysis showed the price was oversold, price continued heading downwards until trading indicator crossed over to above Zero.

Technical Analysis - Balance of Power Indicator MetaTrader 4 Technical Indicators Technical Analysis