Custom High Low Indicator

What is the custom high low indicator?

The custom high low indicator is a tool that can be used in forex trading to identify key levels of support and resistance. This indicator can be tailored to the trader’s specific needs and can provide insights into market trends and potential entry and exit points. By tracking the highest and lowest points of currency pairs over a given time period, the custom high low indicator tries to help traders make more informed trading decisions and improve their overall success in the forex market.

Custom High Low Indicator Strategy

Here are the steps involved in this strategy:

  • Set the time frame: First, select a time frame for the custom high low indicator that matches your trading style and goals. For example, if you are a day trader, you might use a custom high low indicator set to track the highest and lowest points of a currency pair over the past 24 hours.
  • Identify key levels: Once the custom high low indicator is set up, look for significant highs and lows that have been established over the selected time frame. These levels can act as support and resistance areas, and can provide potential entry and exit points for trades.
  • Determine the trend: Next, analyse the trend of the currency pair using other indicators or price action. If the trend is bullish, look for potential buying opportunities at support levels identified by the custom high low indicator. If the trend is bearish, look for selling opportunities at resistance levels.

Buy Signal

custom high low indicator Buy Signal
custom high low indicator Buy Signal

Here is an example of a buy signal using the custom high low indicator in forex trading:

  • Look for a currency pair that has established a recent low, as identified by the custom high low indicator.
  • Confirm that the trend is bullish using price action.
  • Enter a long position when the price rises above the recent high established by the custom high low indicator.

Sell Signal

custom high low indicator Sell Signal
custom high low indicator Sell Signal

Here is an example of a sell signal using the custom high low indicator in forex trading:

  • Look for a currency pair that has established a recent high, as identified by the custom high low indicator.
  • Confirm that the trend is bearish using price action.
  • Enter a short position when the price falls below the recent low established by the custom high low indicator.

Custom High Low Indicator Pros & Cons

Pros

  • Identify key levels of support and resistance: The custom high low indicator can help traders identify important levels of support and resistance that can be used to make more informed trading decisions.
  • Customizable settings: The indicator can be tailored to a trader’s specific needs and trading style, allowing for flexibility and accuracy.
  • Real-time data: The custom high low indicator provides real-time data on currency pair price movements, allowing for quicker decision-making and entry/exit points.
  • Simple and easy to use: The custom high low indicator is a straightforward tool that can be used by traders of all levels.

Cons

  • Lagging indicator: Like all technical indicators, the custom high low indicator is a lagging indicator that may not provide timely signals in fast-moving markets.
  • False signals: There is always the potential for false signals, where the price may briefly break a support or resistance level identified by the indicator before continuing in the opposite direction.
  • Over-reliance: Traders may become over-reliant on the custom high low indicator, leading to tunnel vision and ignoring other important factors such as market news or economic data.

Conclusion

In conclusion, the custom high low indicator can be a useful tool for forex traders to identify key levels of support and resistance and make more informed trading decisions. The indicator is customizable to a trader’s specific needs and trading style, and provides real-time data on currency pair price movements. However, like all technical indicators, the custom high low indicator is not foolproof and may produce false signals or lag in fast-moving markets.

Free Forex Robot