Basic Momentum Indicators
In the prior chapter you saw how to use the basic tools that we've taught thus far. If you'd like to practice applying them, visit thesensibleguidetoforex.com, and search for the trade simulations exercises or trade diaries. That's where we'll post trade scenarios, give you the chance to play them, then provide suggested solutions.
Now it's time to add a new and different set of technical tools to your arsenal—momentum indicators. They are useful in helping to answer the following common trader dilemmas.
For example, look what happened to gold from May 2009 to August 2011 (see Figure 8.1).
Source: MetaQuotes Software Corp.
From May 2009 to August 2011 it kept ...