Introduction To Forecast Osc Oscillator Indicator For MT4
Forecast Osc Oscillator Indicator For MT4, AKA. ‘ForecastOsc’ is a technical Forex indicator that is used to forecast the future price and trend in the market. This indicator generates signals ahead of time so that the traders can make their trading decisions accordingly. Forecast Osc Oscillator Indicator For MT4 compares the closing price of the currency pair to its time-series forecast. The time series function is also known as ‘tsf,' and it calculates the projection of the price trend for the next bar. Forecast Osc Oscillator Indicator For MT4 accepts two arguments. The first one is the time series, it is usually used to forecast the next bar’s closing price and the second one is the specific period. Essentially, the indicator crossovers give the buy-sell signals. When this indicator is above the zero line for a more extended period, it indicates the healthy buying trend and forecasts the bullish trend in upcoming days. If this indicator continues to stay below the zero line for a more extended period, it means that the downtrend is strong and expects bearish price movement in the near future.
Trading Strategies By Using The Forecast Osc Oscillator Indicator For MT4
Basic Crossover Strategy
This is a primary trading strategy and it works well when the market is in trending condition. The strategy calls for a long position when the indicator gives a crossover below the zero line. Conversely, when the Forecast Osc Oscillator Indicator For MT4 goes above the zero line and gives a crossover, a trader should enter a short position.
Let’s look at the below chart to see the crossover signal in action.
In the above GBP/AUD Forex chart, our Forecast Osc Oscillator Indicator For MT4 gives four buying signals as the indicator gave a crossover below the zero line in an uptrend market. All the four trades were able to capture the sizeable moves in the Forex pair. Most of the traders use this strategy to trade the intraday market. Always remember that trading with the trend is crucial.
In the below image, the Forecast Osc Oscillator Indicator For MT4 generates a couple of sell signals in the same GBP/USD market when the crossover happened above the zero line. But none of those signals are genuine. Hence, try to avoid minor moves and focus on significant market moves. Also, this is the reason why we say always trade the market with the trend.
Forecast Osc Oscillator Indicator For MT4 + Moving Averages
Moving averages are one of the most popular indicators in the Forex industry. There are a lot of moving averages, but for day trading, most of the traders use smaller MAs. In this strategy, we used the 20-period moving average, which is quite popular and reliable as well.
The strategy is simple. When the moving average goes below the price action and at the same time, if the Forecast Osc Oscillator Indicator For MT4 gives a crossover below the zero line, it is a call to take the buy trade. If you are a conservative trader and you wish for confirmation to take a trade, activate your trade when this indicator goes above the zero line.
As you can see in the below image, the market is in an uptrend. When the 20-period moving average was below the price, and the Forecast Osc Oscillator Indicator For MT4 gives crossover below the zero line, it indicates a buy signal. We have also highlighted the conservative entry for traders who wish for confirmation. It's easy to scale your position in conservative entries because most of the conservative entries are sure shot trades. If the Forecast Osc Oscillator Indicator For MT4 holds above the zero line in an uptrend, then you can scale your positions during the pullback. Close your position when the moving average goes above the price action.
Just do the opposite of buy in a bearish trend. When the 20-period moving average goes below the price action, and at the same time if this indicator also prints a crossover above the zero line, it is a call to activate the sell trade.
In the above NZD/CHF Forex pair, our strategy gives four consecutive sell signals, and each move generates a decent number of pips in the market. When trading with the trend, you can easily scale the market but do not scale every trading opportunity. Scale only those opportunities which look pretty decent to scale. You can also compare the most recent two legs to identify the strength of the trend and make the scaling decision accordingly.
Forecast Osc Oscillator Indicator For MT4 is not that popular indicator in the industry but after backtesting it, we can say that it is one of the most reliable indicators when used correctly. It works very well in all the market conditions, you can use the Forecast Osc Oscillator Indicator For MT4 crossover alone to trade the market. But when used in conjunction with other indicators, the signals generated are more credible. In super strong trending conditions, this indicator goes flat some times. Hence it doesn’t generate any trading signals at all. But if you have enough patience, it is the best tool for you to generate great trading signals. We hope you understood the working of this Forecast Osc Oscillator Indicator For MT4. Try incorporating this indicator in your daily trading activities. Happy Trading!