Binary options trading platforms are increasingly growing their presence online and it seems that they do not employ all of the indicators that we are used to seeing in the foreign exchange scene. The same type of technical indicators that are used on forex trading platforms can be applied when analysing orders and applying them in binary options markets.
Besides these technical indicator tools, the investors are able to apply custom indicators/tools categorically engineered charts on MetaTrader4 and retrieving alerts that can be used for binary options market as well. When trading binary options, you can find some tools that are default, for example Relative Strength Index or RSI, MACD and Stochastic technical indicator which accompany the MetaTrader4 platforms. These indicators possess a variety of functions and uses. Investors who are planning to adopt these tools as means of assessing their assets should consider the type of trade that they are planning on following. Below are described some of the most typical indicators that can be employed by the investors with the types of trades which are suitable for them.
1. Stochastic Oscillator – This is applied when an asset is caught in a range bound market. Most times, this indicator is used alongside oversold or overbought indicators that are joined with a Bollinger Band
2. Bollinger Band – These are seen functioning broadly across a large number of binary options when mixed with a trustworthy overbought or oversold technical indicator.
3. Parabolic SAR – This indicator is the best match for investors who are looking for reversal pints in the binary options market. Even though it picks up the signal or alert a bit late, if it is properly used together with other indicators such as the ADX or the reversal candlestick chart pattern, its signal can be improved a lot.
4. RSI – Relative Strength Index – The RSI reveals the strength of an ongoing trend and this is what makes it perfect for entering positions that are specified as no-trade or trade type order.
5. MACD – This indicator determines the price diverge. To be certain that this indicator works the best way it can, it should be used together with put or call options and a long expiry time accompanying them.
6. Pivot Calculator – Pivot Calculator is a simple tool that is widely used with other custom indicators to determine alerts for the binary option’s range that is made of put or call, no-touch or touch options.
These are some of the technical indicators that can be used in binary options trading. It is up to the investor to decide on which assets he wants to apply these indicators with and what is the best way to mix them for best trading results and highest profits.