An Introduction to Technical Indicators
Technical indicators are calculations plotted on or below a price chart to help you measure trend, momentum, and volatility. They do not predict the future — they summarize what price has already done so you can make a more informed decision.
Moving averages: smoothing the trend
A moving average plots the average price over a set number of periods, smoothing out the noise so the underlying trend is easier to see. When price sits above a rising moving average, the trend is generally up; when it sits below a falling one, the trend is down. Many traders watch where shorter and longer averages cross for early signs of a shift.
RSI and MACD: measuring momentum
The Relative Strength Index (RSI) oscillates between 0 and 100 and is often used to flag when a market may be overbought (high readings) or oversold (low readings). The MACD compares two moving averages to gauge momentum and the strength behind a move. Both are momentum tools — useful for context, not as standalone buy or sell buttons.
Less is more
The biggest beginner mistake is stacking ten indicators until the signals contradict each other. Pick one trend tool and one momentum tool, learn how they behave together, and confirm with support and resistance. Look up RSI, MACD, and moving average in the glossary, then test your setup on a free demo account.
Fidorix Editorial Team
Trading Education & Market Research
The Fidorix Editorial Team writes practical, jargon-free guides on forex, binary options, and disciplined trading — built from the same tools and data our traders use every day.
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