Home Technical Analysis Chart Indicators: Analysed & Tested

Chart Indicators: Analysed & Tested

Chart indicators are tools traders use to predict the future direction of a stock’s price more accurately. They are used to analyze historical data and trends, such as price, volume, and momentum, so traders can decide which stocks to buy or sell.

Our articles provide a unique analysis of the reliability, success rates, and how to trade the most important stock chart indicators.

Chart indicators can be used to identify entry and exit points in the markets, as well as to measure potential rewards versus risks. With chart indicators, traders can better assess when to enter or exit a position more confidently.

Donchian Channels Indicator Explained & Profitability Tested

The Donchian Channels indicator in technical analysis helps traders understand market trends and potential price breakouts. It consists of three lines formed by taking the highest and lowest low of a predetermined number of periods, typically 20.

6 Researched & Data Driven Tips for Money Flow Index Trading

To optimally trade using the MFI indicator, traders should look for overbought, oversold, and divergence conditions as key signals. For the best results, consider backtesting your strategy.

Money Flow Index Indicator Best Settings & Reliability Tested

The Money Flow Index (14), on a daily chart, outperformed the S&P 500 stocks over 26 years. Its total return was 1,690%, compared to a buy-and-hold strategy profit of 881%.

How to Trade the McClellan Oscillator Effectively

The McClellan Oscillator is a technical analysis tool designed to assess the market breadth of the New York Stock Exchange (NYSE). It is renowned for its effectiveness in revealing the underlying strength or weakness of the market by comparing the number of advancing to declining stocks.

Elliott Wave Theory: Usage, Rules & Reliability Tested

Elliott Wave Theory is a scientifically unproven technical analysis indicator used to attempt to predict price movements in financial markets. I highly recommend avoiding this indicator.

KDJ Indicator Explained: Best Settings & Strategy Tested

The KDJ is a stochastic oscillating technical analysis indicator that helps traders predict price reversals. According to our research, the KDJ has a 63% success rate if configured correctly.

Weighted Moving Average (WMA) Explained & Reliability Tested

Our research reveals the WMA underperforms other moving averages with only a 7% win rate on a standard OHLC chart. However, using it on Heikin Ashi charts produces excellent results.

How to Trade Pivot Points in Stocks Based on 66,480 Trades

Traders utilize pivot point indicators to predict when stock prices will reverse direction. But does it work? I tested 66,480 trades on 210 years of data, and the results are surprising.

3 Top Momentum Indicators Explained & Tested

In technical analysis, momentum indicators help traders identify the strength and direction of a stock's price. We explain and test three popular momentum indicators for reliability.

OBV Indicator: Best Settings & Trading Strategy Explained

On-balance volume (OBV) is a cumulative indicator in technical analysis designed to show the volume flow relative to a security's price movements. The OBV reflects the collective buying and selling pressure crystallized through the volume trend.

RSI Indicator Explained: Best Settings & Strategy Tested

The Relative Strength Index (RSI) is an oscillating momentum indicator that measures the speed and change of stock price movements. RSI uses a scale from 0 to 100 to indicate overbought or oversold conditions.

Does Ichimoku Cloud Work? Success Rates & Settings Tested

Ichimoku Cloud, or "Ichimoku Kinko Hyo", is a moving average based chart indicator that visualizes the market's direction, momentum, and support/resistance levels.

ADX Indicator Best Settings & Trading Strategy Tested

According to our in-depth testing, an ADX(DMI + 14) setting crossing above 20 is a profitable buy signal, and crossing below 20 is a reliable sell signal. These settings resulted in an ADX 28% outperformance versus the S&P 500 stocks.

Mean Reversion Trading Strategy Explained with Examples

The mean reversion trading strategy suggests prices and returns eventually move back toward the mean or average. Reliable indicators like Stochastics, RSI, and Bollinger bands are based on mean reversion to identify overbought and oversold conditions.

Aroon Indicator Explained: Best Settings & Strategy Tested

In technical analysis, the Aroon indicator identifies trend reversals and trend strength. This oscillating indicator has two parts: the "Aroon Up" line measures uptrend strength, and the "Aroon Down" line for downtrend strength.

Reading & Trading Volume Profile Indicators Like a Pro

Volume profile technical analysis indicators provide a uniquely detailed overview of volume distribution across price levels, offering traders insights into market structure and supply and demand zones.

How to Trade the DMI Indicator Profitably: 9,764 Trades Tested

Our testing, based on 9,764 trades over 25 years, proves the DMI indicator is profitable and reliable, outperforming the S&P 500 index.

Simple Moving Average Trading Settings & Strategy Tested

The simple moving average (SMA) technical analysis indicator helps identify stock price trends. It calculates an arithmetic average of prices, offering a smooth line that eliminates short-term price volatility.

ATR Indicator: Settings, Reliability & Usage Tested

The average true range (ATR) is a nondirectional momentum indicator that measures price volatility. Our 1,205 test trades showed a solid 1.77 reward-to-risk ratio with an average 8.5% winning trade.

Fibonacci Retracement Trading Tested! Does it Work?

In technical analysis, Fibonacci retracement is used by traders to predict levels of support and resistance by drawing horizontal lines according to the Fibonacci sequence. But Does It Work?

Our Best Training & Strategies

Liberated Stock Trader Pro: Learn Stock Market Investing

Learn stock market investing with the complete online stock trading course by Barry D. Moore, a certified financial analyst from the International Federation of Technical Analysts (IFTA).

ETF Investing Strategy: MOSES Improves Performance & Lowers Risk

The MOSES ETF investing strategy is a powerful suite of indicators meticulously backtested over 100 years. Designed to empower you to outperform the market, it equips you with the tools to navigate major stock market crashes and unlock greater investing performance.

LiberatedStockTrader’s Strategy Beat the Market By 102%

Decades of research and testing unveiled the Liberated Stock Trader Beat the Market System. Our 9-year, backtested, and proven strategy targets 35 financially healthy high-growth stocks, producing a track record of beating the S&P 500 by 102%.

TradingView Review 2024: Tested by LiberatedStockTrader

LiberatedStockTrader's review testing awards TradingView 4.8 stars due to excellent stock chart analysis, pattern recognition, screening, and backtesting. TradingView is our top recommendation for US and international traders.

Stock Rover Review 2024: Tested by LiberatedStockTrader

LiberatedStockTrader's review testing awards Stock Rover 4.7 stars. Its advanced screening, research, and portfolio tools are ideal for US value, income, and growth investors. With 650 financial metrics on 10,000 stocks and 44,000 ETFs, we rate Stock Rover the number one stock screener.

Trade Ideas Review 2024: AI Tested by LiberatedStockTrader

Our in-depth testing shows Trade Ideas is the ultimate black box AI-powered day trading signal platform with built-in automated bot trading. Three automated Holly AI systems pinpoint trading signals for day traders.

TrendSpider Review: Big 2024 Updates! Is It Now The Best?

Our TrendSpider testing finds it is ideal for US traders wanting AI-automated charting, pattern recognition, and backtesting of stocks, indices, futures, and currencies.

Benzinga Pro Real-time News Tested by LiberatedStockTrader

Our testing shows Benzinga Pro is best for US traders who want a high-speed, actionable, real-time news feed at 1/10th of the price of a Bloomberg terminal. I recommended Benzinga Pro for active day traders and investors who trade news events.

MetaStock Review 2024: Tested by LiberatedStockTrader

Our MetaStock review and test reveal an excellent platform for traders, with 300+ charts and indicators for stocks, ETFs, bonds & forex globally. Metastock has solid backtesting and forecasting, and Refinitiv/Xenith provides powerful real-time news and screening.