A fellow subscriber asked me:
…I was wondering which is the best indicator for trend trading?
Here’s what I said:
There a few common indicators that trend followers use like Moving Average, Bolllinger Bands, Average True Range etc.
However all these don’t matter if you do not understand how your indicator works.
You must understand how your indicator works and how it fits into your trading plan, rather than blindly following overbought/oversold signals.
For me personally, I use the Average True Range and Moving Average indicator.
Lastly, I share my views on Sugar, NZD/USD, GBP/USD ,WTI and GBP/CAD.
Which is The Best Indicator for Trend Trading?
I hope you’ve enjoyed this week’s market analysis. I hope you have found this information helpful in finding which is the best indicator for trend trading. As always, comments are welcomed and encouraged. Cheers!
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Thank you for sharing this great analysis with us 🙂
You’re most welcome.
Don’t hesitate to let me know if you have any questions. I’ll be glad to help.
Thank you Rayner for all your kindness.
I just must to tell, it was great to see that we follow after the same pairs and commodities, of course because I read your book recently 🙂
And actually, I don’t have any question, because, your explanation is so simply and clearly.
Definitely great to hear that!
Yes the trending pairs are usually the ones that get most of my attention.
Very useful now i am trying to see my chart naked and try to understand it without any indicator. Very informative. Good job.
Thank you for your feedback.
Hope to hear more from you in the near future.
Love your reviews – keep up the good work. Just a bit confused on how you place your Stop Loss. In the Sugar trade you placed it just past the 20 EMA but in the G/Can trade you placed it just past the 50 EMA. If you had placed it just past the 20 EMA you would have been stopped out. In other videos you mentioned you placed your Stop Loss based on structure and in others you use 2 ATR. I realize that the market dictates what you use for a Stop Loss but do you have more specific rules in your trading plan on placing Stop Losses so we can understand this better?
I’ve actually got long at the breakout at 2.0394 with SL at 2.0092.
My stoploss is basically 2 ATR from my entry price.
I said it was at 50 EMA because that is the location of my original stop loss.
If price goes in my favor, I’ll watch which EMAs are being respected and trail them accordingly.
Hope that clears up for you 🙂
So, as I understand, If price goes in your favor, do you change your stop-loss and put it on lower price than 2ATR? Please Rayner, could you explain it to us again or maybe there is a post that discuss this topic when and how to trail a stop-loss..
Thanking you in advance.
I use a default 2 ATR for my entries.
As price goes in my favor.. I would trail it depending on the market conditions.
Generally I use the moving average or price structure.
This 2 videos here should explain better.
Let me know if it helps 🙂
Sure it’s help me to undrestand 🙂
About the trade in the 1st link (USD/JPY), you trailed your stop-loss according to EMA 50 and you put it under EMA 50, when do you have to change it? because the EMA 50 every new candle is changing, so every 4H hours you had to update your stop-loss or accordind to different time frame you calculate the 2ATR?
Thank you so much!!
I simply monitor it about once a day.
True every 4 hour the line will shift, but it is only very slight and doesn’t make much of a difference.
Thanks Rayner 🙂
(I noticed that I couldn’t reply on your answer above)