What Is an Indicator?

Indicators are statistics used to measure current conditions as well as to forecast financial or econo🦄mic trends.

In the world of investing, indicators typically refer to 澳洲幸运5开奖号码历史查询:technical chart patterns deriving from the price, volume, or open interest of a given security. Common technical indicators ♉include moving averages, moving average convergence divergence (MACD), relative strength index (RSI), and on-balance-volume (OBV).

In economics, indicators usually refer to pieces of eco𒆙nomic data used to measure the overall health of the economy and predict its direction. They include the Consumer Price Index (CPI), Gross Domestic Product (GDP), and unemployment figures.

Understanding Indicators

Indicators can𝔉 be broadly categorize🎐d into economic indicators and technical indicators.

澳洲幸运5开奖号码历史查询:Economic indicators are statistical metrics used to measure the growth or contraction of the economy as a whole or sectors within the economy. In 澳洲幸运5开奖号码历史查询:fundamental analysis, economic indicators that quantify curren🌌t economic and industry conditions are used to provide 🀅insight into the future profitability potential of public companies.

澳洲幸运5开奖号码历史查询:Technical indicators are used extensively in 澳洲幸运5开奖号码历史查询:technical analysis to predict changes in s🦩tock trends or price patterns in any traded asset.

Economic Indicators

There are many economic indicators created by d🧸ifferent sources in both the private and public sectors.

For example, the 澳洲幸运5开奖号码历史查询:Bureau of Labor Statistics, which is the research arm of the U.S. Department of Labor, compiles data on prices, employment and unemployment, compensation and work conditions, and productivity. The price report contains information about 澳洲幸运5开奖号码历史查询:inflation, import and൲ export prices, and🌃 consumer spending.

The 澳洲幸运5开奖号码历史查询:Institute for Supply Ma🍷nagement (ISM) is a not-for-pro♕fi𝔉t professional association for supply management and purchasing professionals.

It has published its monthly since 1931. The report contains a composite index, the 澳洲幸运5开奖号码历史查询:Purchasing Managers' Index (PMI), which contains informationဣ on manufacturing and non-manufacturing orders. The in⛦dex is a closely watched barometer of economic activity.

The U.S. 澳洲幸运5开奖号码历史查询:Department of Commerce uses ISM data in its evaluation of the economy.

For most of the 21st century, housing and real estate have been leading economic indicators. There are several metrics used to measure housing growth including the 澳洲幸运5开奖号码历史查询:S&P/Case-Shiller Index, which measures house sale prices, and the 澳洲幸运5开奖号码历史查询:NAHB/Wells F𝓰argo Housing Market ♎Index, which is a survey of home �𝔍�builders that measures the market appetite for new homes.

Other economic indicators include interest rates, the 澳洲幸运5开奖号码历史查询:money supply, and 澳洲幸运5开奖号码历史查询:consumer sentiment.

Technical Indicators

In the context of technical analysis, an indicator is a mathematical calculation based on a security's price or volume. The result is used to predict future prices.

Common technical analysis indicators are the 澳洲幸运5ಌ开奖号码历史查询:moving average convergence-divergence (MACD) indicator and the 澳洲幸运5开奖号码历史查询:relative strength index (RSI).

The MACD is based on the assumption that the tendency of the price of a traded asset is to revert to a 澳洲幸运5开奖号码历史查询:trend line.

The RSI compares the size of recent gains to recent losses to determine the asset's price momentum, either up or down. Using tools like t♓he MACD and the RSI, technical traders will analy🧸ze assets' price charts looking for patterns that will indicate when to buy or sell the asset under consideration.

Examples of Indicators

Consumer Price Index (CPI)

One of the most common economic indicators is the Consumer Price Index (CPI), which is simply the weighted price average of a basket of consumer goods and services. Changes in CPI are used to measure changes in the cost of living and to identifyܫ periods of inཧflation or deflation.

At the time of writing (Summer 2021), investors are becoming increasingly concerned that rising inflation will finally upend the bull run in the stock market. In April 2021, the CPI increased 0.8%, making it the biggest 12-month increase since September 2008.

Moving Average (MA)

Moving average (MA) is a technical indicator used to identi♍fy the general direction, or trend, of a given stock. Its purpose is to smoothen historical price data by generating a constantly updated average price.

If the MA is moving in a positive (negative) direction, that's a bullish (bearish) sign for the stock.

At the time of writing, Amazon sto♑ck recently , suggesting that it's an attractive pick from a technical standpoint.

Indicator FAQs

Wꦗhat Is a Common Indicato💞r of a Phishing Attempt?

Emails that are completely unsolicited, conඣtain several typos, require urgent action, and demand unusual actions from you are all indicators of a phishing attempt.

What Economic Indicator Deജscribes Generally Declining Prices?

A steadi🍷ly declining CPI is an indicator of generally declining prices.

What Is a Key Performance Indicator?

A key performance indicator refers to a quantifiable measurement used to measure a company's success against a specific target or objective. Common KPIs include net profit, sales, and customer retention rate.

What Is an RSI Indicator?

The relative strength index (RSI) is a technical analysis indicator that compares the size of recent gains to recent losses. RSI is used to determine the asset's price momentum, either up or down.

What Is the Genuine Progress Indicator?

澳洲幸运5开奖号码历史查询:Genuine progress indicator (GPI) is a metric used to ga♌uge a country's rate of economic growth. It is often considered a more reliable measure of economic progress than the more widely used gross domestic product (GDP) figure.

What Are Indicators of a Company's Profitability?

Commonly used indicators of a company's profitability include gross margin, operating margin, net margin, and return on equity (ROE).