5/20 MA Rule

First posting for me on here so hello to all! Probably a silly question but im just starting!

I am just new to TA having always been a fundamentals man. I have been checking out different methods for spotting possible risers. I have seen that the 5/20 MA crossover looks like a good sign and also the 50/20 Crossover.

However, can anybody tell me what is a good indicator to confirm a possible price increase after a crossover? I have looked at MACD and it looks good too but is there any other indicators that anybody could advise me to look at?

Many Thanks in advance.

If you are new to TA then welcome to the world of a million indicators! If you want some examples of different indicator-based systems then have a look at www.forex-tsd.com as an example, but people will always quibble over what indicators are 'best', it's more a case of finding ones that suit your style/timeframe of trading. Also, remember the exit signal is as/more important than the entry...

You might want to try ADX /DMI to confirm the market is trending and not just trading sideways. I sometimes use DMI crossover (the positive and negative lines of the ADX indicator will crossover, whichever is on top is the direction of the trade.

I hope this helps you in profitable trading, I like ADX but that is my personal pref.

daytradingUK said:

You might want to try ADX /DMI to confirm the market is trending and not just trading sideways. I sometimes use DMI crossover (the positive and negative lines of the ADX indicator will crossover, whichever is on top is the direction of the trade.

I hope this helps you in profitable trading, I like ADX but that is my personal pref.

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Thanks for the reply. Will check it out. I have found that sideways trading and 5/20 does not work! I have not seen the ADX/DMI before.

Jan said:

Thanks for the reply. Will check it out. I have found that sideways trading and 5/20 does not work! I have not seen the ADX/DMI before.

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ADX/DMI is just one, you could look at Aroon as an alternative.