5 mins binary trade with moving averages
This strategy is recommended for currency pairs, but it might as well work with other assets. With these indicators we can enter a trade at the beginning of it and then ride with it. How to setup the chart […]. You may have seen this indicator before as it is usually a part of more complex strategies.
This is a very thought out strategy which is among my favorites and it brought me lately interesting profits. Even though it is a more complicated strategy, trade openings are very comprehensible from the chart.
Doubles strategy uses Bollinger bands which you may know already. Additionally, it also uses the MACD indicator which is suitable for binary option trade. And how do these indicator get along? How to set up the chart Timeframe: BBand Stop binary option strategy Published: BBand Stop strategie , binary options 5 minutes , binary options strategy , strategie.
Binary strategy , pinbar , value chart. The new strategy Doubles! Shorter term time frame means shorter term signals. In addition moving averages can also be applied to different length charts for different types of analysis. In my first example I chose the 30 bar moving average because that is the one I use most. If I move down to a chart of hourly prices then my moving average is a 30 hour moving average. Adding to the mix is the choice of simple or exponential moving average.
To recap, a simple moving average is an average of the last X number of data with each data point getting equal weight. As a each day closes it is added to the list and the last days data is dropped off.
Because the front end of the data is given more weight it responds to price changes quicker than a simple moving average. It also tracks prices more closely and can give more false signals. If you look at the chart above you can see what I mean.
The exponential moving average is moving over and under the simple moving average even though they are set to the same time period. The same is true for the pair of day moving averages. The answer to that question can take up volumes, maybe shelves, of books.
However, there are a few key areas in which moving averages are particularly helpful. The first is trend. A moving average is, or can be, the first step in determining a trend.
If the MA is pointing up then the asset is moving higher on average, otherwise known as trending up. If it is pointing down then the asset is trending down. Because you can use different periods with your moving average it is possible to measure trend in more than one time frame on the same chart at the same time.
Moving averages can also provide support and resistance targets. The chart above shows an asset that is supported in the long term evidenced by the bounce in prices from the long term bar EMA. This could be a potential entry signal for binary traders. Two other important ways that advanced binary traders can use moving averages is for wave analysis and as a coincident indicator.