What are the few common trend indicator that could earn us a good trade ?

<p id="isPasted"><strong>Average directional index</strong></p><p>This indicator is based on how strong a trend is, using a scale going up to 100 to measure that strength. Plotted on a graph, an increasing ADX line shows an increasing trend strength, while a falling line shows a decrease in trend strength. In the case of average directional index, a falling line doesn't mean a reverse in trend, only a weakening of the current trend.</p><p>This trend following trading strategy indicator also shows trend momentum, with an increasing number of higher peaks suggesting stronger momentum and lower peaks showing decreasing momentum. This can be a helpful tool to prevent exiting a trend too early or too late. Simply identifying a change in momentum can help traders to decide when to exit a trade or when to put risk-management strategies in place.</p><p><br></p><p><strong>Bollinger bands</strong></p><p>This is another technical analysis tool where three lines are plotted on a graph, representing the simple moving average, an upper band and a lower band. The bands are based on standard deviations of recent price movements. Like RSI, this trend trading strategy indicator can identify overbought and oversold signals and suggests the level of volatility in the market.</p><p>The 'Bollinger bounce' refers to support and resistance levels and should only be traded when a security is not experiencing a trend. The 'Bollinger squeeze', however, is the thing for which a trader should look out when trading trends. When the two bands come together, it's likely a signal of a trend breakout.</p><p><br></p><p><strong>Donchian channels</strong></p><p>These indicators are used to spot trend breakouts and retracements, utilising candlestick charts as opposed to graphs. Like Bollinger bands, these rely on three bands to represent market momentum and show the highest highs and lowest lows.</p><p>Traders typically open a long position when a security trends towards the upper band, suggesting a rise in value. They look to enter a short position when the trend shows a downward momentum.</p><p>Calculating Donchian channels is done by identifying the highest high of the upper band and the lowest low of the lower band over a set time period. The value of the lower band is then subtracted from the upper band value. This figure is then divided by two. This middle line is then used as a signal of when to enter and exit trades.</p>

<p id="isPasted">While no indicator can guarantee a profitable trade, several common trend indicators can significantly increase your probability of success when used correctly. The most effective strategy combines multiple indicators to confirm signals and employs strict risk management.&nbsp;</p><p><strong>Popular trend and momentum indicators</strong></p><p><strong>Moving Average (MA)</strong></p><p>Moving averages smooth out price data to provide a clearer view of the trend by filtering out random, short-term price fluctuations.&nbsp;</p><p>Simple Moving Average (SMA): The average price over a set period. It is more lagging than other types, meaning it reacts more slowly to price changes.</p><p>Exponential Moving Average (EMA): Gives more weight to recent prices, making it more reactive to new information.</p><p>Trading Strategy (MA Crossover): A bullish signal ("golden cross") occurs when a shorter-term MA crosses above a longer-term MA, suggesting a potential uptrend. A bearish signal ("death cross") occurs when the opposite happens.&nbsp;</p><p><strong>Relative Strength Index (RSI)</strong></p><p>This momentum oscillator measures the speed and change of price movements, ranging from 0 to 100.&nbsp;</p><p>How it works: An RSI reading above 70 suggests the asset is overbought and a price correction may be coming. A reading below 30 indicates it is oversold and a bounce may be imminent.</p><p>Trading Strategy: Look for divergences, where the price makes a new high or low, but the RSI does not confirm it. This can signal weakening momentum and a potential trend reversal.&nbsp;</p><p><strong>Moving Average Convergence Divergence (MACD)</strong></p><p>The MACD is a versatile indicator that combines trend and momentum. It is calculated by subtracting a 26-period EMA from a 12-period EMA.&nbsp;</p><p>How it works: A MACD line, a signal line (the 9-period EMA of the MACD line), and a histogram are used to detect changes in momentum. Crossovers of the MACD line and the signal line are common buy and sell signals.</p><p>Trading Strategy: A bullish signal is generated when the MACD line crosses above the signal line. Crossovers below the centerline can also provide additional confirmation.&nbsp;</p>