Basics of Indicators

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Technical indicators are mathematical calculations based on the price, volume, or open interest of a security or contract  used by traders who follow technical analysis.

By analyzing historical data, technical analysts use indicators to predict future price movements.

Examples of common technical indicators include the Relative Strength Index, Money Flow Index, Stochastics, MACD and Bollinger Band.

Technical indicators are commonly used by active traders, since they’re designed to analyze short-term price movements, but long-term investors may also use technical indicators to identify entry and exit points.