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Forex Strategy on a combination of indicators ADX and PSAR


It’s no secret that absolutely any forex trader would like to know where is the bottom or top of the trend on a chart … and although sometimes it seems a solution to this problem seems simple, in fact, this is not so simply.
Predict whether a sequence was completed wave pattern, or we are witnessing at the moment just roll the larger trend - it’s really nothing like an art, not science.

In these situations we have to use multiple sources of information presentation, and it usually helps to avoid some false trading signals and ultimately save our funds on deposit in precisely those cases that predict us as traders horosheee ratio of risk to profit. Always remember this, I’ll tell you in this forex strategy of using 2 completely different indicators, which we shared - is Average Directional Movement Index (ADX) and the index of Parabolic Stop and Reverse (PSAR). The combination of these two indicators allowed a forex strategy that allows to open trade transactions as close as possible to the top or bottom of a trend.

These indicators ADX (Average Directional Movement Index) and the PSAR (Parabolic SAR) is already registered in the trading terminal DC, working on the best platform for trading Metatrader 4. To activate them, go to the menu item Insert / Indicators / Trends and activate them one by one ).
To begin, we consider both these indicators one by one and analyze their characteristics.

Indicator ADX, or otherwise - Average Directional Movement Index:
The ADX is nothing like trading a trend following system, which was developed by Welles Wilder. This index can be used to trade on its own, but usually it is applied to the price chart along with an indicator of DMI. Which in turn is used to measure market trend.

Let us consider the mechanism of functioning of the digital indicator DMI:
  1. It consists of 2 lines DI and DI -
  2. To apply it in the following way: we open the position to buy as soon as the DI line crosses up DI-. And we’ll open the position up for sale as soon as DI - crosses above DI.
  3. The intersection of lines DI / DI - gives trading signals on the input or output. But if these trading signals are used separately, they are quite often wrong, which often leads to a double loss. So, to filter these trading signals and is used indicator ADX.


The ADX is part of the trading system, which was devepoled Wilder. It signals to us that the price in the market is ready to change their direction of motion. As a result, combining ADX with DI, we eliminate unnecessary losing trades. 
The ADX helps the trader to determine whether there was a moment in the forex market trend or not, and gives us information about what stage we are the trend - the trend has just started or is already in its final stage. He also gives us information about the states of prices in the market as soon as there is no trend, as well as priduprezhdaet of turns and the resumption of traffic on the current trend.

See more detail in this link.... 
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