ADXdon Indicator For MT4
Table Of Contents:
- ADXdon Indicator For MT4
- Bullish and bearish cross
- Significance of the green curve
- Execution of the trades
- Setting up the stop loss and take profit
- Managing the risk factors
- Dealing with the major news
ADXdon Indicator For MT4 is a very popular indicator in the Forex market. The indicators allow the retail traders to find the key trend reversal point in the price movement of a certain asset. Those who are completely new to this indicator, might not understand how this indicator works. Just by seeing the above chart they will get confused and stay away from the ADXdon Indicator For MT4.
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Alerts In Real-Time When Divergences Occur
But once you learn to use the ADXdon Indicator For MT4, you will always rely on its reading to ride the major trend reversal in the market. There are three curves in this indicator. The green curve in the indicator helps the retail traders to assess the volatility of the market trend. If you the green curve rises in the indicator window, you can assume a high level of market volatility. The red curve in the indicator is the positive DI curve and the blue curve is the negative DI curve.
Bullish and bearish cross
Some of you might think the ADXdon Indicator For MT4 is only used to measure the strength of the market trend. But by using the + DI and – DI curve you can also spot trend reversal. If the +DI curve (red curve) crosses above the –DI curve (blue curve) you can consider it as a bullish crossover. On the contrary, if the +DI curve crosses below the –DI curve, consider it as a bearish crossover signal. During the bearish and bullish crossover, the green curve should also stay near the crossover zone to consider it as a valid cross over.
Significance of the green curve
Some of you might not understand why the green curve must stay near the cross over the region to consider it as a trend reversal sign. The green curve is usually used to measure the strength of the market trend. If you rise in the green curve consider it as a sign of increased market volatility. On the contrary, if the green curves head south in the indicator window consider it as a sign of low-level volatility. You might not understand how things work at the initial stage, but if you study the indicator curve it won’t take much time to learn its feature.
Execution of the trades
Trade execution is fairly easy when you use the ADXdon Indicator For MT4. You need to look for the bearish crossover to find short trade setup. On the contrary, to execute the long orders you need to find bullish crossover. The new traders might find the process little bit complex but if you analyze the below chart, you will understand the process of trade quality trade execution by using the ADXdon Indicator For MT4.
Figure: Bullish cross over in the ADXdon Indicator For MT4
From the above figure, you can see the +DI curve (red curve) has crossed above the –DI line (blue curve). Right at moment the green curve also shows low indicates the trend is slowly losing its momentum. Since the previous trend was bearish, a loss in the trend momentum indicates the buyers are slowly taking control of this market. But just having a bullish cross over is not enough to execute the long trade. You need to have a decent bounce from the critical support level. If you observe the above chart, you will see a nice double bottom pattern right before the bullish crossover. This also indicators strong chances of bullish reversal in the market.
Setting up the stop loss and take profit
If you trade the market by using the ADXdon Indicator For MT4, you must have a clear idea about the support and resistance level. Set the stop loss just below the support level when you execute long orders. For short orders, you need to set the stop loss just above the critical resistance level. If possible learn price action trading strategy so that you can use the different formations of the Japanese candlestick pattern to execute high-quality trades with precise stop loss.
Setting up the take profit is fairly easy when you use the ADXdon Indicator For MT4. If you execute a long trade, you can ride the newly formed trend unless you spot a bearish reversal signal in the indicator window. Similarly, you need to look for bullish cross in the indicator reading for you short trade setup. But always make sure, you are trading the market with 1:3+ risk-reward ratio or else it will be tough to recover the loss.
Managing the risk factors
Though ADXdon Indicator For MT4 gives you perfect trade signals, still you need to learn the proper way to embrace the losing trades. Losing trades are very common in the Forex market. No matter which indicator you use, you must prepare for the worst-case scenario. Make sure you are not trading the market with the money that you can’t afford to lose. Risk 2-3% of your account balance and try to protect your trading capital by every possible means. Never get emotional after losing a few trades. Consider the losing trades as your business cost and wait for the next trade setup. Trade the market with confidence and never rely on gut feelings to make a profit from this market. Andy tries to keep things simple in the trading profession since it increases your profit factor.
Dealing with the major news
You need to understand the fact, ADXdon Indicator For MT4 is used to find the reversal in a market. So, if you must keep yourself updated with the latest fundamental news or else you will be losing a big sum of money. Some of you might think, understanding the details of fundamental analysis is a very complex method. But in reality, it’s easier than technical analysis. Learn about the high impact news and see how the market reacts to different data. If necessary, use the demo account to develop your fundamental analysis skills. But always make sure you blend technical and fundamental data to find the best possible trade setups in this market.
