We would like to present ADX WMA Bands indicator. This is a forex technical indicator and it is one of the simplest buy and sell signals indicator. You can also use this indicator when building your own forex trading system. To build a successful trading system you will need various technical indicators, but for trend change recognition you can definitely use ADX WMA Bands indicator. This indicator was created for short-term trading and therefore you should use on low timeframes like 5m, 15m or 1h. Better avoid holding trades for longer periods like 1 week. You will get best results with opening and closing trades during same day. There are no limits when it comes to choosing the currency pairs.
Rules for long trades – BUY
Use trend lines to confirm bullish direction of the trend.
Confirm bullish shape of ADX WMA Bands indicator.
Open a buy on price action buy signal (piercing pattern, dark cloud cover etc.).
Place the stop below the entry signal bar.
Place the target at the zone of the upper band, or simply before the next resistance zone.
Rules for short trades – SELL
Use trend lines to confirm bearish direction of the trend.
Confirm bearish shape of ADX WMA Bands indicator.
Open a sell on a selling price action signal shows up (piercing pattern, dark cloud cover etc.)
Place the stop above the entry signal bar.
Place the target at the zone of the lower band, or simply before the next support zone.