Accelerator Oscillator and ADX Indicator
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The Accelerator Oscillator and ADX Indicator can be combine together to provide reliable entry and exit points.
Although there is not much similarity in both of these trading tools, they can be used concurrently to plan your next trade.
The Accelerator Oscillator or AC was developed by Bill Williams as a development component of Awesome Oscillator.
It calculates the difference between the Awesome Oscillator and the 5 period moving averages.
In other words, it is used to measure the acceleration and deceleration of the Awesome Oscillator.
It can also be used to detect trend reversals.
If the AC moves above zero line, it signals that acceleration to the upside would continue.
In case it moves below the zero line, continuation of the acceleration to the downside is signaled.
The ADX Indicator, also known as Average Directional Index, is used to measure the strength of a trend.
In other words, it lets you know when the trend is about to change its direction and how strong the trend is.
It can also be used to establish a trend to be strong or weak.
High readings point toward a strong tend whereas low readings indicate weak trends.
When we combine both these indicators, what we are looking for is the trigger point.
You could also find out whether the signals have developed on a resistance level or support level.
You can easily locate the high points and low points in your trading graph.
Always start using a Forex Demo Account to practice until you are much more confident with your own reading of the market using any strategy.
Once you are profiting consistently with a demo account, then it’s time to move over to a real money account.
Be safe out there.
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