1. Trend Indicators
Helps to determine the overall market direction (bullish, bearish, or sideways).
Moving Averages - MA:
The idea: Smoothing price movement to determine direction.
Use in futures: Used in crossover strategies (like the crossover of the 50 and 200 averages) to determine entry and exit points in futures contracts. The Exponential Moving Average (EMA) is popular because it responds to price faster than the Simple Moving Average (SMA).
Ichimoku Cloud:
The idea: A comprehensive indicator that displays information about trend, support and resistance, and momentum in a single chart. 2. Momentum Indicators
They determine the speed and strength of price movement and indicate the likelihood of a reversal.
Relative Strength Index (RSI):
The idea: It measures the speed and change of price movements. It helps identify overbought areas (usually above 70) and oversold areas (usually below 30).
Usage in futures: Very important in the volatile cryptocurrency market, as it indicates when an asset is overvalued (short-selling opportunity) or undervalued (buying opportunity). Divergence between RSI and price is considered a strong reversal signal.
Moving Average Convergence Divergence (MACD):
The idea: It shows the relationship between two moving averages of the asset's price.
Usage in futures: Provides buy and sell signals when MACD lines cross the signal line, giving an early indication of change.
3. Volatility Indicators
They measure the degree of change in the asset's price, which is vital in the cryptocurrency futures market.
Bollinger Bands:
The idea: It consists of three lines: a moving average (the middle line) and two standard deviations (standard deviations) above and below the average.
Usage in futures: Helps determine whether the price is relatively high or low. A "squeeze" in the bands indicates a period of low volatility followed by an imminent explosion in prices.
Average True Range (ATR):
The idea: It measures market volatility over a specified time period.
Usage in futures: It does not provide a direction, but it is best for determining position size and placing stop-loss orders based on the market's actual volatility.$BTC
