The Different Types of Technical Indicators Used by Traders Today

Do you want to be able to maximize profits on all of your stock trades? Here are the different types of technical indicators that day traders use today.
Posted by uptownguy

Did you know that you are considered a day trader by the SEC (Securities and Exchange Commission) if you do four or more day trades within 5 trading days?

If you are new to day trading stocks, confused or lost, and are looking for some additional help, then we’ve got you covered. Technical indicators are an easy way for even a newbie to figure out the trends of various investments. Read on to find out the most common technical indicators to help with day trading stocks.

Trend Indicators

If you are interested to learn whether a market is moving up, down, or sideways, then a trend indicator is your best friend here. You can use moving averages to determine the price action over specific periods and subdivide the total to create a running average. Both 50-day and 200-day exponential moving averages are popular with day traders.

Mean Reversion Indicators

These indicators measure how far a price swing will stretch before something in the market will cause it to retract again. Bolinger bands is a technical analysis tool that measures the volatility over time of the price of some financial instrument.

Relative Strength Indicators

This one is all about oscillations – the ups and downs in buying and selling pressure. If you know anything about the market, it’s that the market goes through buy-and-sell cycles that can be identified through indicators. These cycles usually reach their peak when the market has been oversold or overbought, something that you can’t identify on the chart with the naked eye.

Momentum Indicators

If you wish to learn how fast the price changes in a particular investment over time, then you need to look at momentum indicators. Moving average convergence divergence (MACD) indicators are a powerful way for day traders to figure out price change speeds. It’s very useful stock market data to have in hand when trying to make buying or selling decisions.

Volume Indicators

By tallying up trades, volume indicators help you figure out whether bulls or bears are in control. If bulls are winning, when higher prices would be in force. If bears, then lower ones. This is a great way to figure out the positive or negative trend of a market and whether the market is poised for a reversal.

If you need more help with day trading, check out for additional support, knowledge, and analysis.

Technical Indicators Might Seem Out There at First

When you first see terms like MACD and SMA, you might start feeling a little apprehensive and a lot lost. But as you get more comfortable with technical indicators (and it takes a bit of time), they will become as common a vernacular to you as your mother tongue.

Don’t delay – learn all the available technical analysis tools out there to become a better, more profitable day trader.

If you loved this article and wished there was more where it came from, there is! Keep browsing our website to learn more about day trading and the stock market.

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