Hello Traders,
Moving average is one of the most common and efficient indicators which provides great triggers for professional traders both for Forex and the binary options, last week we discussed about the moving average, and some strategies that translate moving average signals into binary option successful strategy.
One of the most important tip i warmly recommend is to cross the trigger with another indicator or strategy, when you get signals from two different strategies or indicators it’s a strong signal with high successful rates that can be reach above 85%, so this time i’d like to discuss on another popular indicator which i usually use, the Stochastic indicator.
When i trade the binary option i use the chart system provided by the broker, yet, in case i want to get more detailed and rich graphs i use external graph system such as Metatrader or Netdania.
Both the moving average and stochastic are basic and common, they both should be available on every platform you are using.
The stochastic is a momentum indicator that shows us when a momentu of a trend is going to end or t least is getting weak, it contain two lines showing the location of the close price relative to the high and low ranges over a certain number of periods.
When the short line crosses the long one from above it can point of changing directions from long to short and vice versa, more stronger case is if iit happens over 80% level or if vice versa below 20% level.
EURUSD Daily stochastic signals
In most cases, the stochastic can trigger before a change is taking place. at the example above there is a great signal where both of Movoing average and stochastic are showing cross towards call signals and might be it’s also a signal for reversing trend but in the short term it was a winner.
Now let’s analyse the market with both of the indicators.
GBPUSD Monthly chart
On the monthly chart the stochastic is making a cross for reverse trigger, yet, the moving averages are still showing a downward trend, this is an example for a trigger you should avoid or at least wait and see how it will developed.
On the Daily chart, the stochastic is crossing between lines but nothing is realy changes for the moving average, it might take us to a more neutral trend but for now there are no triggers for the moving average and stochastic.
The S&P is on interesting period of all times high, for the ones who keep with call options it is important to pay attention for a warning sign such as the stochastic indicator on the Daily chart
S&P Daily
For now, there is no cross not for the moving average and not for the Stochastic, but it is worth to keep an eye on these indicators especially the stochastic which is now above 80% level, a cross between line is the first warning sign.
Another great trigger is coming from USDCHF currency, which i find very hard to trade on lately, but still where there is a clear trigger it is worth to check and follow.
USDCHF Monthly chart
On the monthly chart the stochastic indicator is close for a cross, in case it will happen above the 80% it’s a trigger to go short meaning more put options to win.
Have a successful week,
