NexTrader v2.1

Trading can be a profitable pursuit but it can also be a very risky one.

A lot of traders do not have the time to study the market all day long, which means they don’t have the time to study the patterns that develop over the course of a day or week.

There is a way to trade that overcomes this problem by trading indicators that help you catch the trend in the early stages, something that is all too easy to miss. (The way to do this is to use a trading system based on the previous months average price and the current months average price, that is described in this post.)

Yes, it is possible to trade without indicators. We can argue about how much better it is to trade with trading indicators, but all is better than nothing.

Here in Nextrader we decided to show you how to trade with average* monthly prices. The idea behind this trading indicator is that the average monthly price is a reflection of the price action of the instrument.

Some traders believe that there is a possibility that the price will go back to the average monthly price level. In general, the use of the average monthly price as a trading indicator is not new and is very common among advanced traders.

Everyone is looking for trading indicators that can predict future trends.

This one is based on past prices and goes well across all time frames. It uses the average price for the current month and the average price for the last month to predict future price direction.

The indicator is the result of a simple moving average crossover system.

The fast average(white crosses) is based on the current month price and the slow average(red crosses) is based on the last month price. When the current month price crosses above the previous month price the signal line turns up and indicates a positive trend.

The thing to keep in mind here is that the average is not an indicator of when to buy or sell, but rather a direction signal generator.

The wider distances between two lines the stronger trend direction is. The shorter distance meaning more sideways price action.

* The average is just a mathematical tool that will help you to generate a trading rule.