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Successful forex traders know[br]how to use market indicators

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that reveal the best time to buy,[br]or sell a forex cross rate.

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Here are four[br]of the most popular.

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The first one is [br]a trend-following tool,

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which suggests whether [br]to enter a long, or short position.

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Essentially, trend-following tools[br]help traders recognize major trends,

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and then profit by trading[br]in those trends' directions.

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One method is the moving[br]average crossover.

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If the price of a stock climbs [br]above its 20-day moving average,

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it could be [br]a signal to buy.

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The second is a trend[br]confirmation tool.

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If it concurs with [br]the trend-following tool,

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a bullish sign tells a trader[br]to take a long position

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in the currency [br]pair in question.

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A bearish sign means find [br]an opportunity to sell short.

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The moving average [br]convergence divergence,

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or MAC-D is a popular [br]trend-confirmation tool.

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The third indicator is [br]an overbought, oversold tool.

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Traders must decide whether to jump in[br]as soon as a clear trend is established,

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or to wait until after a pullback[br]occurs, so they can minimize risk.

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The three-day relative strength index[br]can help traders make the decision.

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The RSI calculates the total sum of up[br]days and down days over a time period,

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providing a value that [br]ranges from 0 to 100.

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An asset is deemed overbought[br]once its RSI level nears 70,

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and undervalued[br]if it nears 30.

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And the fourth indicator[br]is a profit-taking tool.

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An RSI that rises to 80 or more is an[br]indication that it's time to take profits.

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Other good indicators are [br]Bollinger bands and a trailing stop.