Forex moving averages are amongst the most commonly used trading indicators. I wouldn't go as far to call them the 'best forex indicators' simply because the person who uses one indicator is doomed for failure. You could consider forex moving averages - your 'bread and butter' - the basics behind your forex success and getting those fx pips.
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Forex Moving Average Graph vs. Price Action Graph
Correct usage of moving averages will help you identify a trend, that could be upwards, downwards or even flat. The gentle, smoothing effect a forex moving average has (compared to the erratic price movements) makes it much easier to identify these trends.
It is very important to be able to identify real upwards or downwards trends. Occasionally a trend might look like it is going one way or the other when it is actually flat (moving sideways or ranging). Understanding the moving average trend and the price actions (eg. forex candlesticks) can help you identify this.
Entry & Exit Times
Placing the moving average over a price (either a price graph or a forex candlesticks chart) can help you identify entry and exit points. A buy sign could be when the trend is upwards and the closing price is above the trend line. A sell sign could be when the trend is downwards and the price is below the forex moving average line.
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