How to decide the proper values for indicators?

<p id="isPasted">To decide proper indicator values, consider relevance, accuracy, and practicality. For technical indicators in trading, backtesting on historical data can help optimize parameters. In chemistry, the pH range of an indicator should match the pH change during a reaction.&nbsp;</p><p>Here's a more detailed breakdown:</p><p>1. For Technical Indicators (Trading):</p><p>Backtesting:</p><p>This involves testing the indicator's performance on past price data to see how it would have performed.&nbsp;</p><p>Parameter Optimization:</p><p>Experiment with different settings (e.g., period, type, smoothing) to find the best configuration for your trading strategy.&nbsp;</p><p>Consider Market Conditions:</p><p>An indicator that works well in one market phase (e.g., trending) might not be effective in another (e.g., ranging).&nbsp;</p><p>Combine with Other Tools:</p><p>Technical indicators are rarely used in isolation. They should be combined with other analysis methods, such as candlestick patterns or fundamental analysis, for a more comprehensive view.&nbsp;</p><p>2. For Acid-Base Indicators:</p><p>pH Range: Choose an indicator whose color change occurs within the pH range where the reaction's equivalence point lies.&nbsp;</p><p>Equivalence Point: This is the point where stoichiometrically equal amounts of acid and base have reacted.&nbsp;</p><p>pKa: The pKa value of an indicator is related to the pH at which it changes color.&nbsp;</p><p>Visual Clarity: The color change should be easily detectable and rapid.&nbsp;</p><p>Reactivity: The indicator should not react with the substance being titrated.&nbsp;</p><p>3. For General Indicators (Monitoring and Evaluation):</p><p>Relevance:</p><p>The indicator should directly relate to the project's objectives and theory of change.&nbsp;</p><p>Measurability:</p><p>It should be possible to collect and analyze data related to the indicator.&nbsp;</p><p>Cost-Effectiveness:</p><p>Consider the resources needed for data collection and analysis.&nbsp;</p><p>Targets and Baseline:</p><p>Define clear targets for the indicator and establish a baseline against which progress can be measured.&nbsp;</p><p>SMART:</p><p>Indicators should be Specific, Measurable, Attainable, Relevant, and Time-bound.&nbsp;</p>