Disliked{quote} Here is my picture Mr B.Out of UDJY..4 hr.. still in at 114.58 move my stop to 20 points above.. we will see..i usually trade very short term.. bit lazy tday..if the blue lite blue CCI will just turn sharp down will sell a few more {image}Ignored
I can assure you that these so-called overbought/oversold indicators are virtually worthless in highly trending markets like the Forex.
However, if you still want to use them here is, in my opinion, the only way to profit from them:
When the trend is up (a triple moving average can determine the trend for example), then:
1: Wait for a pullback (to a Fib level or a previous resistance level for example).
2: Wait for the oscillator to go into oversold territory.
3: Wait for the oscillator to turn around and re-emerge from that oversold zone and then BUY (assuming the price is still above these 3 simple moving averages of course).
This is by far the best way to use these oscillators, because you are still betting WITH the trend. The same logic applies to downtrends of course, only in reverse.
Most traders do the exact opposite, they short the market simply because the indicator is "overbought", or they buy the market simply because the oscillator is "oversold", regardless of the current trend (and/or price action).
Big, BIG mistake.
Anyway.
