The direction of price range price fluctuations and volume. This technical force index indicator considers three parameters. Force index indicator is an oscillator developed by alexander elder to measure the strength of bulls upon growth of the price and the strength of bears upon its decline.
About the category forex indicators forex indicators are trading tools based on mathematical analysis that are able to graphically indicate the signals of the foreign exchange market and visually inform the trader about the current dynamics of the exchange rate of currency pairs. The force index indicator is not as popular as some of the more well known forex technical indicators but can still be a very important trading tool when incorporated within a more complete forex trading strategy the primary purpose of using the force index indicator is to show traders how strong the bears are during a downtrend and how strong the bulls are during an uptrend. Below is an example of how the force index might be applied to a daily chart of wti crude oil based on the.
3 trade exited when ema goes neutral or force index 0. 2 ema of price negatively sloped. 1 force index decreasing or index ema negatively sloped.
3 trade exited when ema goes neutral or force index 0. Direction extent and volume. Developed by alexander elder the force index was introduced in his classic book trading for a living according to elder there are three essential elements to a stock s price movement.
The force index is an indicator that uses price and volume to assess the power behind a move or identify possible turning points. Regardless of the market forex securities or commodity market indicators help to represent quotes in an accessible form for easy perception. Stop loss should be set to 15 20 pips away from the entry price.
Moving average period 20 simple method parabolic sar indicator step 0 02 maximum 0 2 macd indicator fast ema 12 slow ema 26 macd sma 9 force index indicator period 13 simple method. The force index is a trend following oscillator that quantifies the movement of the market it combines three basic elements such as the direction of movement scale and market size it relies on an auxiliary line to provide greater clarity so that it indicates a dominant bullish trend when the indicator remains above this line and a bearish trend when the indicator remains below. Alexander elder for a powerful and in the future long term trend it is necessary not only to break through the current level of support resistance but also to provide a new.
For the first time the description of the force index oscillator frc or the elder index ei is published in the book trading for a living by dr.
Forex force index indicator. How to play on the winner s side.
How to play on the winner s side.
