The HLC Trend Indicator is a technical analysis tool used to identify trends in the forex market. In this article, we will discuss the definition, working, and best settings of the HLC Trend Indicator for MT5, and how to use it to trade in the forex market.
Definition
The HLC Trend Indicator is a trend-following indicator that uses the high, low, and close prices of a currency pair to identify the direction of the trend. It is based on the premise that the trend is your friend, and that trading with the trend is more likely to be profitable than trading against it.
Working of HLC Trend Indicator in MT5
The HLC Trend Indicator for MT5 works by comparing the current high, low, and close prices of a currency pair with the previous periods. The indicator uses a moving average of the highs, lows, and closes to identify the direction of the trend.
When the current price is above the moving average of the highs, lows, and closes, the trend is considered bullish. Conversely, when the current price is below the moving average of the highs, lows, and closes, the trend is considered bearish.
Best Settings for HLC Trend Indicator
The best settings for the HLC Trend Indicator depend on the trading strategy and the time frame being used. Generally, traders use a shorter time frame, such as 5 minutes or 15 minutes, for intraday trading, while a longer time frame, such as 1 hour or 4 hours, is used for swing trading.
Traders can also adjust the period used in the calculation of the moving average. The default setting is 14 periods, but traders can adjust this to suit their trading style and strategy.
How to Trade with HLC Trend Indicator?
The HLC Trend Indicator can be used to identify the direction of the trend and to enter trades in the direction of the trend. Here are two common ways to use the HLC Trend Indicator to trade in MT5:
Identifying the Direction of the Trend
Traders can use the HLC Trend Indicator to identify the direction of the trend in the market. When the indicator shows a bullish trend, traders should look for buying opportunities, and when the indicator shows a bearish trend, traders should look for selling opportunities.
Entering Trades in the Direction of the Trend
Traders can also use the HLC Trend Indicator to enter trades in the direction of the trend. When the trend is bullish, traders should look for buying opportunities, and when the trend is bearish, traders should look for selling opportunities. Traders can use other technical analysis tools, such as support and resistance levels, to enter trades with more precision.
Features of HLC Trend Indicator
The HLC Trend Indicator has several features that make it a useful tool for traders. Some of these features include:
- Real-time data on the direction of the trend
- Can be used to enter trades in the direction of the trend
- Can be used in combination with other technical analysis tools.
Conclusion
The HLC Trend Indicator for MT5 is a useful tool for traders looking to identify the direction of the trend in the forex market. By using this indicator in combination with other technical analysis tools, traders can enter trades with more precision and increase their chances of success. The HLC Trend Indicator is easy to use and can be adjusted to suit different trading styles and time frames. Download the HLC Trend Indicator for MT5 for free today and start using it in your trading strategy.