Best Leading Indicator Trend Indicator & Momentum Technical Indicator Combination
Best combination of indicators PDF - Stochastic Oscillator indicator, MAs indicator, RSI indicator & MACD technical indicator
Stochastic Oscillator technical indicator can be combined with other technical indicators to form a strategy - Buy Sell Signal Indicator MT4 Indicators. For our examples we will combine it with:
- RSI technical indicator
- MACD indicator
- Moving Averages Gold Indicator
Indicator Combination Examples 1:
Sell Signal - Best Combination of Indicators for Swing Trading
From our strategy the sell signal gets generated when:
- Both Moving Averages are moving down
- RSI indicator is below 50
- Stochastic moving downward
- MACD indicator heading downward below centerline
Sell signal was generated when all these trading rules were met. The exit signal gets generated when a signal in opposite trend direction is generated ie. 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 whip saws as possible in the process.
- Stochastic - is a momentum oscillator
- RSI technical indicator- is a momentum oscillator
- Moving Averages XAUUSD Indicator- is a trend following indicator
- MACD indicator- is a trend following indicator
It is very helpful to combine more than one indicator, as a combination of signals is much better than relying on just one single indicator. The indicator combinations reinforce each other, and cancel out false whipsaw fake out trading signals.
A trend following indicator helps one to see the overall picture, while using more than one momentum indicator gives better & more reliable entry and exit points for trading.
Best combination of technical technical indicators & their signals help to analyze a lot of market activity.
Example 2:
Buy Signal - Best Combination of Indicators for Swing Trading - Best Indicator Combination
For this trading indicator combination example the 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 one avoid these trading whipsaws?
The answer is by combining other indicators such as MACD indicator, RSI Indicator & MAs a trader could have avoided the whipsaws, as shown on the trading example above MACD technical 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 was not decisive so as to signal a decisive trend reversal.
As long as MACD indicator is above zero center line mark even if MACD indicator lines are heading downward then the market trend is still upwards. As you can see from the above 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 indicator is best combined with other indicators & signals which are generated are confirmed using other indicators to form - Best Leading Indicator Trend Indicator & Momentum Gold Indicator Combination - Best Combination of Indicators for Swing Trading - Best Indicator Combination - Best Indicators for Strategies.
