Forex trading mostly involves technical analysis. Meaning one refers to forex charts to find out what was the previous pattern of the currency pair. Thjs anaysis is used to project the future behaviour.

This analysis is accomplished by certain available technical indicators. There are lot of technical indicators that have gained popularity such as the RSI, Stochastic, MACDs, EMA, Fibonacci etc.

However the choice of the forex technical indicators depend on the imeframe of trading. For e.g. MACD is applicable  mostly on 1 hr and above timeframe chart and not so much on 15 min or 5 min forex charts.

On the other hand Pivot points are mostly intraday targets, so they are more useful on smaller timefram charts such as 15 min chart and even 5 min chart. Pivot points are not mostly used on the 1 hr and above charts.

Now why is that?

Most of you might be aware of the reason. Its because any chart settings of 1 hr and above are mostly used for swing trading where the forex trades are mostly opened for few hrs to days. So the forex technical indicators should be ones that are not too sensative. Where as in day trading, you need the indicators that are quick in indicating if a good trading oppoprtunity has come.

We'll look at the Pivot Point Technical indicator in the next post.

Thats some general overview of forex technical indicators