For minimal human factor influence on working data on financial markets, the mechanisms of objective reality identification are included in trading strategies. Most frequently forex market indicators are these mechanisms, that trace impartially market situation development and give structured information to the trader for trading decisions.
Despite the difficulty of previous wording, the essence of indicators is easy: to trace determined activities and to produce them in a processed form for a trader on specified algorithm. As in any area indicators may tell the trader and its trading system when to do what and warn about a critical situation.
Forex indicators have statistical mathematical algorithm that transforms quotations into necessary activities for a decision making. Thus the most important factor in indicator usage is comprehension (or creation, if we are talking about a proper unique indicator) of this mathematical algorithm. The knowledge of algorithm of indicator computation is essential for understanding the finite data shown by the indicator. The correct interpretation of the data displayed by indicator is also very important. Since same results may be interpreted differently which is inadmissible for systematic profitable trading.
That is why the best forex indicators for traders are those indicators, the mechanisms of which they fully understand and can confidently interpret given indicator in any situation.