Best Indicators Used By Traders In The Indian Share Market

With rising retail participation in India’s equity markets, technical analysis has become a widely used tool among traders. While price action remains central to market decision-making, indicators help traders interpret momentum, trend strength, and potential entry or exit points. In the Indian share market, a few technical indicators are consistently used across intraday, swing, and positional trading due to their reliability and adaptability to different market conditions.

Market experts caution that indicators are most effective when combined with risk management and broader market context, rather than used in isolation. The following indicators are among the most commonly applied by Indian traders.

Automatic Demand and Supply Indicator by GTF

The Automatic Demand and Supply Indicator features automatic multi-timeframe zone detection, enabling it to highlight key demand and supply zones across different timeframes without manual drawing. Traders can choose from Aggressive, Conservative, and Dynamic sensitivity modes based on their trading style and risk appetite. It also includes built-in trend detection to help users identify the broader market direction and align trades with institutional flow. The tool comes preloaded with 20, 50, and 200 Exponential Moving Averages, widely used for assessing trend direction, pullbacks, and momentum changes.

A key capability is its multi-timeframe visualisation, which allows higher-timeframe zones such as weekly or monthly levels to be displayed directly on lower-timeframe charts, supporting top-down analysis. The indicator offers customizable appearance settings for cleaner charting and is available on GTF’s official website. Advanced versions include GTF Indicator 2.0, which improves zone precision and trend filtering, and GTF Indicator 2.0 Extended, which adds multi-timeframe candles, selected fundamental data overlays such as P/E ratio, earnings, and market capitalisation, along with volume insights for a more comprehensive analytical setup.

Moving Averages

Moving averages are one of the most widely used indicators in the Indian share market. They help traders identify the overall market trend by smoothing price fluctuations over a selected period. The 20-day, 50-day, and 200-day moving averages are particularly popular.

Short-term traders often track the 20-day moving average to assess momentum, while long-term participants rely on the 200-day average to judge broader trend direction. Crossovers between shorter and longer moving averages are commonly used to identify potential trend shifts.

Relative Strength Index (RSI)

The Relative Strength Index, or RSI, is a momentum indicator used to measure the speed and change of price movements. In the Indian market, RSI is widely applied to identify overbought and oversold conditions.

An RSI reading above 70 generally signals overbought levels, while readings below 30 indicate oversold conditions. Traders also watch the 40–60 zone to confirm trend strength. RSI is frequently used for timing entries and exits in both intraday and swing trading.

Moving Average Convergence Divergence (MACD)

MACD is another widely followed indicator among Indian traders, particularly for trend confirmation. It works by analyzing the relationship between two moving averages and a signal line.

Traders often look for MACD line crossovers and histogram expansion to identify changes in momentum. MACD is commonly used in trending markets and is effective when combined with support and resistance analysis.

Volume

Volume plays a critical role in validating price movements in the Indian share market. A price move supported by strong volume is considered more reliable than a move occurring on low participation.

Traders closely observe volume spikes near breakout levels, trend reversals, and support zones. Rising prices with increasing volume often indicate strength, while divergence between price and volume can signal weakening momentum.

Bollinger Bands

Bollinger Bands are used to measure volatility and identify potential price expansion or contraction. The indicator consists of a moving average with upper and lower bands plotted based on standard deviation.

Indian traders use Bollinger Bands to spot volatility breakouts, especially after periods of price consolidation. When prices move close to the upper or lower bands, traders assess whether the move is supported by momentum or likely to revert.

Fibonacci Retracement

Fibonacci retracement levels are commonly used to identify potential support and resistance zones during pullbacks. Levels such as 38.2 percent, 50 percent, and 61.8 percent are closely watched in the Indian market.

Traders apply Fibonacci retracement after strong directional moves to find areas where the price may resume its original trend. The tool is often combined with price structure and volume for higher accuracy.

Use of Indicators with Caution

Market professionals emphasise that no single indicator guarantees success. Indicators work best when aligned with price action, market structure, and disciplined risk management. Overloading charts with multiple indicators can lead to conflicting signals and decision fatigue.

As Indian markets continue to evolve with higher retail participation and faster information flow, traders increasingly focus on clarity, simplicity, and consistency rather than chasing complex indicator combinations.