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5 Most Reliable Forex Indicators in 2025

5 Most Reliable Forex Indicators in 2025

Understanding Forex Indicators

  • Trend Indicators: Help identify the direction of the market trend.

1. Relative Strength Index (RSI)

  • RSI above 70 suggests an overbought market (potential for a price drop).
  • RSI below 30 indicates an oversold market (potential for a price rise).
An image of Relative Strength Index

2. Bollinger Bands

  • A middle band (SMA)
  • An upper band (SMA + standard deviation)
  • A lower band (SMA – standard deviation)
An image of Bollinger bands

3. Moving Average Convergence Divergence (MACD)

An image of Moving Average Convergence Divergence
  • A bullish signal occurs when the MACD line crosses above the signal line.
  • A bearish signal occurs when the MACD line crosses below the signal line.

4. Stochastic Oscillator

An image of Stochastic Oscillator
  • Readings above 80 indicate overbought conditions (potential sell signal).
  • Readings below 20 indicate oversold conditions (potential buy signal).
  • A bullish signal occurs when the %K line crosses above the %D line in the oversold region, while a bearish signal occurs when it crosses below the overbought region.

5. Ichimoku Kinko Hyo

  • Tenkan-sen (Conversion Line)
  • Kijun-sen (Base Line)
  • Senkou Span A (Leading Span A)
  • Senkou Span B (Leading Span B)
  • Chikou Span (Lagging Span)
An image of Ichimoku Kinko Hyo
  • When the price is above the cloud, it indicates an uptrend.
  • When the price is below the cloud, it signals a downtrend.
  • When the cloud turns from red to green, it suggests bullish momentum, while a switch from green to red indicates bearish momentum.

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