Keltner Channel Strategy

The Keltner Channel strategy is nothing new. However, many Forex trading beginners have been using it recently as an alternative to the more popular Barometer strategy. The Keltner Channel strategy uses three moving averages to indicate the direction of the market. When combined with the Channel indicator, this is said to provide a sign of: 

  • Support;
  • Resistance for a particular currency.
keltner channel strategy

Keltner channel description

The Keltner Channel strategy is very easy to understand. For example, when looking at a long term chart of the EUR/USD pair, you would see a series of vertical bars. On this same page you would also see the same series of bars with different color-coded levels. 

This means that these levels represent the three different moving averages on which the investors make their decisions about the currencies to trade. As the levels move, they signal to investors whether or not the EUR/USD is expected to: 

  • Go up; 
  • Stay the same;
  • Fall down in value. 

When traders decide to enter or exit the forex market, they use the signals given by the channels.

Technical analysis technique

The keltner channel strategy works on the same basis as the Bollinger Bands used in Forex trading. In fact, both are based on the same technical analysis technique where an upward or downward movement is detected by the channel. However, the channel takes on a more complex appearance when it is combined with the Bollinger Bands. These combine the channel with a combination of indicators like the: 

  • Stochastics; 
  • Moving Average Convergence/Divergence. 

These combine to give a signal to investors when to buy or sell a particular currency.

Why is it so popular?

There are many people who use the keltner channel strategy to trade the forex market. This is because the strategy has been proven to be quite successful. It has been developed in conjunction with the Bollinger Bands strategy that was developed to help currency trading dealers detect currency price trends. Both the system short positions and long positions are combined with the use of varying levels of Bollinger bands to signal when to buy or sell.

When the trend continues upward, this means that the currency prices will continue to rise. At this point, the trader will want to buy, so he will add currency to his short positions. When the price action breaks down, this means that the trader will want to sell off the currency he is holding in his long positions. Thus, when the trend continues upward with the breaking of the resistance, this means that the prices will continue to move upwards.

Middle line

This is basically how the strategy works. When the middle line is broken, the platform will draw a line between the top and the bottom of the previous day’s high and low. The middle line is the upper limit of: 

  • Support; 
  • Resistance. 

The key to this trading strategy is the fact that it is based on a simple moving average, or SMA, which is determined by moving averages of closing prices over a period of time.

SMA

The SMA is considered as one of the more reliable indicators when determining where a currency will go. There are two types of this trading strategy: 

  • Top line;
  • Bottom line. 

The former uses the upper and lower channels as resistance levels while the latter uses the envelope based technical indicators. These indicators are used in place of the traditional technical analysis methodologies that are often seen in forex trading. Some of these techniques include: 

  • Support and resistance levels; 
  • Oscillators; 
  • Fibonacci levels; 
  • Other formations.

MT4 importance

The MT4 indicator uses the moving average of the price in a channel that spans the range between two points. Traders use this channel as a means to support their positions while eliminating those that may be risky. The best thing about using this particular channel is that it can be updated rapidly and easily using a software program. While it has been claimed that this strategy provides positive results, it has also been said that some of its indicators are not very accurate. It is important for traders to understand that accuracy cannot be achieved with accuracy.

5 Minute Binary Options Strategy

Five Minute Binary Options Strategy is the most successful minute binary option’s strategy, which is based on a trading plan that has been tried and tested by many successful traders. You can follow this same strategy by taking the information provided here and modifying it to fit your own needs. First you should always do your research and find out as much as possible on the market about any given option before you ever make an investment. 

This way you will be able to determine the likely direction the option is going to take and accordingly place your trade. Also you should understand what is happening in the financial markets at the time you are making your investment so that you can make decisions about your own trading strategy. There are many different indicators out there to choose from but here are the ones that we find the most useful for our own strategies.

5 minute binary options strategy

Understanding of Indicator

This is the easiest of the 5 minute binary options strategy indicators to understand and implement. All you have to do with this indicator is to set the threshold price above which you will only invest if the asset becomes within a certain range. When the asset reaches the threshold price you will then receive a “call” signal. The best thing about this particular indicator is that it is very easy to understand and implement. All you have to do is: 

  • Set the threshold price; 
  • Define what range you are looking at the range over and above;
  • If the asset reaches the range you defined then you will receive a “put” signal.

Moving averages and their usage

There is a 5 minute binary options strategy using moving averages. Moving averages are normally used to determine the general direction of a particular asset over time. They work by showing the price action over a period of time that is equal to the average closing price of the currency pairs being examined. What makes using the moving averages strategy so useful is the ease with which you can: 

  • Set up;
  • Use it in your trading account. 

There are a number of different types of moving averages to use and all you have to do is to define which currency pairs are the ones you wish to analyze.

Define the range of indicator

The best part about this 5 minute binary options strategy indicator is that it is very easy to understand and very profitable when implemented. All you have to do is to define the range where the price movement is expected to be, then set the time frame through which the data is going to be collected. If you want to see the complete range of the price movement, then you can use the moving average indicator range bounds feature. Once the range is defined, you can go ahead and set the threshold price within the range to determine whether or not you will enter the trading account and if you are going to enter, what exit strategy you are going to follow.

Its advantages

One of the best advantages of the 5 minute binary option’s strategy is that you can use this indicator if you are in a swing trade and you need to accurately predict the direction of the prices. If the prices move in an upward direction, you must buy. Conversely, if the prices move downward, you should sell. This is the basic concept of the technical analysis indicator and this is something that you can easily apply to the foreign exchange market. You may need to make a few trades before you get the hang of using this indicator correctly, but as you keep practicing, you will start to understand how the prices react to the prevailing market conditions.

Open and the closing price

If you intend to use the 5 minute binary options strategy to trade shares, the best way to predict the direction of the share price movement is to determine the open and the closing price of the underlying asset. By knowing the open and the closing price of the asset, you will be able to make the necessary calculations to determine the exact amount of premium you will need to pay on any particular trade. Once you have this information, you will be in a better position to determine whether the asset’s price moves in your favor or against you.

Filling the form

The 5 minute binary options trading strategy has been made easy by the online brokers. All you need to do is: 

  • Log on to the broker’s website;
  • Fill up the form. 

Once this form has been filled up, you will be sent an online quote. You can compare the quotes offered by different brokers and select the one which suits your requirements the most. Once you are through with the quote, all that remains is for you to click the button of the registration and place the order.

Expiration date

Another important thing that you need to keep in mind is the expiration date. Make sure you know the expiration dates of the particular option that you are going to trade. This is because the longer the expiration date, the more profits you gain from the options. To have a proper knowledge of the expiration times, you can log on to the website of the broker and get the latest updates. The 5 minute binary option’s strategy is something that works only if you have the complete knowledge of the options, the market and the expiry dates.

A Trader’s Guide to Using Fractals in Forex Trading

A Traders Guide to Using Fractals

Trading with Fractals is one of the hottest topics on the Forex market right now. Why are they so hot? Because traders who understand and apply these techniques are seeing their profits skyrocket. So if you’re interested in learning how to use fractals in trading, we have some answers for you!

Dangerous indicator

Trading with fractals is all about setting your stop loss and taking the time to watch the indicator. It is imperative that you learn to look at the indicator as an enemy instead of an ally. If you see an indicator that looks like a triangle, make sure you get rid of it immediately. If you see a triangle that resembles a bell, do not follow the bell, wait for the price to drop before entering into a trade.

Stop loss with Fractals

This may sound crazy, but it is an essential part of trading with Fractals. You should always keep the stop loss in mind and try to take a position in the opposite direction of the indicator that you are following. Now this may sound counter-intuitive, but in the cases of many expert traders it has worked very well. If the price takes an extreme turn downward, you can quickly move your stop loss further out to the right and try to catch the break. Once you enter into a profitable trade, you can reverse your position and try to get out before the price bounces back upward.

Technical indicators with charts

The other important thing to remember when trading with Fractals is to be observant of your own chart. It is easy to become blinded by price movement because you’re looking at: 

  • Simple bar; 
  • Candlestick chart. 

In reality, most technical indicators only tell you how far the price will move in either an up or down direction. However, a good indicator will also provide you with charts that break down the movement of the indicator itself. These charts show you exactly where the breakouts are taking place so that you can enter when the price is heading in the same direction as your indicator.

Important patterns

As stated earlier, most technical indicators can break down the movement of the indicator using boxes and arrows. Your stop loss and position target will likely be based on these patterns. One common pattern is a sharp rise in the price followed by a rapid drop back down. To profit from this, you must take a quick sell and quickly enter your exit position. Since it’s likely the price will continue to move in the exact opposite direction of your signal, if you don’t get out before the reversal, you’ll lose money.

How to use Fractal analysis

This may seem confusing, but Fractals are simple enough to understand once you learn how to use them correctly. The most common way to use a Fractal analysis is on a daily chart of the price chart. Simply look at the key bar, and notice the points that form a perfect triangle, or Fibonacci ratios. These points, along with the peak and the bottom are called points of support and resistance, respectively. 

Since a Fibonacci ratio is formed by the number of times the price closed out (hope), this indicates strength within the market. Since every successful trading strategy takes into consideration at least one of these points, it’s easy to see how an indicator like this can predict trading opportunities.

Best strategy for beginners

For beginners, it’s best to start off by practicing with a simple Forex trading strategy like: 

  • The triangle method;
  • Basic breakout strategy. 

Once you understand how these patterns work and can apply them to your daily chart, then you can take it a step further and start exploring the more advanced techniques. But for now, try to stick to the basics as mentioned above, and keep looking for the breakouts at the end of the day. You can begin applying stop losses and other methods of analysis when the price reaches a new high or low.

Relative strength theory

Another useful tool in your arsenal should be an indicator. Indicators can provide you with important information when it comes to triggering stop losses and other necessary actions. There are many types of indicator and they include: 

  • Moving average convergence/Divergence; 
  • MACD; 
  • Simple Moving Average Convergence Divergence; 
  • RSI indicator. 

They are based on relative strength theory. Regardless of which type of indicator you decide to use, it’s always important to start with a solid foundation of technical analysis, stop losses, and a reliable stop loss in place before you even think about using any other form of trading strategy.

What Is a Breakaway Gap

What Is a Breakaway Gap

Different patterns

If you are new to the stock market trading and are struggling with your trades, then you definitely need to learn more about breakaway patterns. These patterns are very useful for traders as they provide a trader a very important advantage in stock trading. You will learn why these patterns are so powerful in breaking even and closing a profit for you. As well as these patterns, you will discover the importance of breakaway patterns in terms of trading systems. To find out exactly what a breakaway pattern is, and how it can help you trade stocks, then read on.

Index Charts

A breakaway gap refers to a strong price move through resistance or support, quickly. These price moves are often seen early in a trend, as they occur at resistance levels. The price often breaks away from the resistance or support within a small gap, rather than an intraday breakout. This breakaway gap has been seen in many different types of charts, such as the Stochastic, Relative Strength Index, exponential moving averages and the Renko chart. However, breakaway patterns can also be seen in the time series chart of the price. These gaps are most often seen in the: 

  • Stochastic Strength Index charts;
  • Relative Strength Index charts. 

But can be found in the other charts as well.

Trade

To answer the question “What is a breakaway gap?” in stocks, the trend should be identified. If the trend is going to continue in an upward direction, you should see breakaways in the price action. If the trend is going down, you may also see breakaways in the price action. You need to determine the direction of the trend and set your stop loss accordingly.

Moving averages

Another common indicator used to identify what is a breakaway gap. The exponential moving averages. These moving averages help traders know that a certain pattern is about to occur. The trader sets up his or her stop-loss accordingly. If this type of signal is present on the swing charts, then it may indicate that a big breakaway gap will take place later in the trading day.

Technical analysis

A breakaway gap can also be determined using simple technical analysis. The period following a bull market is typically very strong, while the time-frame following a bear market is usually weak. If you notice that the gaps are getting wider in the time-frame that is opposite of the bullish period, then this is your cue that a breakaway gap may occur in the near future. The size of the gaps and their duration can be determined by simply studying the rise and fall of the stock prices over time. This technical analysis is the easiest to do, and it gives you a good chance to decide what is a breakaway gap for any particular pattern.

Predictions

What is a breakaway gap? It is not so much a particular indicator, but rather a general rule of thumb, which is necessary when analyzing any trading chart. There are times when a small breakaway pattern can appear, and at other times when it can disappear just as mysteriously as it appeared. This makes predicting breakouts a difficult task, because no one can tell you what will occur in the next few minutes or hours.

Verdict

Most technical charts have breakouts close to the previous close, which makes interpreting their meaning more difficult. One common interpretation is that a consolidation occurs. A consolidation occurs when the volume of a security’s buyers becomes lower than its sellers. This is an example of how a gap up or break up may indicate a consolidation, because it is when the volume of buyers and sellers becomes equal. In a consolidation, the gap between two trends can overlap, creating a volume spike, or a formation of breakouts, and this volume spike may result in a reversal from the former trend to the latter.

How to Use the Moving Average Indicator?

Moving Average Indicator

The Moving Average Indicator (MAI) is one of the most commonly used statistical indicators to help traders determine the direction and momentum of the market. Many traders swear by the use of moving averages as an aid to profitable trading. So what does moving averages mean in stocks?

Basically, the meaning

Trading with moving averages basically means that you trade with the moving averages as part of your swing trades. For instance: 

  • If you are invested in a trade and the MA indicator is moving up, you buy before the moving average line is broken. 
  • If, on the other hand, the moving averages are breaking down, you sell.

How it is used

So now that we know what a MA means in terms of usage, let’s discuss how they are used. The MA indicator itself can be used as a technical indicator to identify a trend. This is usually done when analyzing a simple moving average, such as: 

  • SMA;
  • MACD. 

Simply put, the moving average tells you when the current stock price is higher than the average that is being charted. Conversely, when the stock price is lower than the moving average line, you sell. Trading with moving averages is similar to trading with price action, but instead of trading with the overall value of the security, you focus on the short-term trend.

Best ways to use MA indicator

There is some controversy, however, as to how well this technique works. Some experts claim that the best way to use moving averages is in conjunction with another trading technique known as momentum trading. What do we mean by this? 

In essence, you would want to trade on trends where the volatility is high, as opposed to low. Think about baseball and the difference between a two-year career from average to great. Volatility can help you make better trading decisions but using moving averages together with momentum trading can give you an advantage that can lead to profitable trades.

What you can find with indicator

If you are just learning to trade Forex, you should first take a look at using the moving averages indicator. You can find numerous: 

  • Articles; 
  • Reviews; 
  • Charts; 
  • Videos that will show you how to use it effectively. 

One thing that many people fail to realize, though, is that you can use moving averages together with other indicators, which can really increase your effectiveness. For example, if you want to know when to enter a long position, you can combine it with the moving average indicator.

Technical usage

If you are a technical trader, you may be wondering how you can use the moving average indicator to your benefit. In fact, it is very easy to incorporate it into your trading system. If you decide to use it to identify a certain stock that you want to get in on, you simply set the moving average value to have it trigger when the value of that stock is rising. Then, when the value of that stock is falling, you can sell your shares and close out your position.

Rise and fall of stock

If you decide to use the moving average indicator to predict what direction a stock will move in, you can set it to trigger when the stock is rising or falling. Of course, you should be sure to always have the market data before you make any predictions, as well. Some people claim that using the moving averages to their advantage is just too good to pass up. They say that they can predict where the price of a stock will go practically an unlimited number of times, especially if they have the right kind of software program. If you don’t feel confident about investing your money in the stock market, though, you should stick with traditional methods instead.

Verdict

You can get moving averages from anywhere online. There are some great free moving average indicator services that you can use, as well. One thing you should remember, though, is that they won’t be able to provide you with any kind of charting functionality. If you want to know how to use the moving average indicator to make reliable predictions about what direction a stock is moving, you’ll probably need to invest in a piece of software that provides the functionality that you want.

Binary Option Price Action Strategy – Which Strategy Will Work For You?

Binary Option Price Action Strategy

One of the most common strategies for binary options trading is called the binary option price action strategy. This is where the trader decides what to do: 

  • Before the trade; 
  • During the trade;
  • After the trade. 

You might think that this sounds easy. It is but if you do not know what you are doing, then it is very difficult. The strategy has been used by professional traders for years. Many new traders jump on the binary options bandwagon without first understanding how to do it.

Options price action strategy

The binary option price action strategy revolves around the binary option’s terms ‘closing price’ and ‘closing time’. This is where the trader determines what they will do before, during and after the trade. This is known as the binary option strategy. The most common way this is done is to determine how much money the investor will make on a certain level before the expiration date. There is also an off-set strategy that is used in binary options.

Main components of strategy

The two major components of the binary option price action strategy include the: 

  • ‘Divergence Factor’;
  • ‘Rational Edge’. 

The Divergence Factor analyzes the difference between the opening and closing prices. This is a positive value. It means that there is considerable price movement in the market. The Rational Edge is the opposite, where the difference between the high and low price is negative.

Many beginners go for the Divergence factor analysis. Unfortunately this is not a very good indicator of how the price will behave. When the price moves in a predictable pattern, you can easily predict its direction, assuming that the price will always go up or down. But when the price changes with no apparent reason, the binary option price action strategy games become difficult.

Change course

The best way to find out whether a particular price will change direction is by looking at the various strategies that use the Divergence Factor and the Rational Edge. If the price action binary options strategy games do not use these two crucial indicators in their strategies, they are useless. You must be able to determine how good your strategy is. You should check whether the strategies you are using can help you make a good profit or not.

Some of the best binary option price action strategy games are those that are based on the divergence and rational edge indicators. This is because these indicators are the easiest to use. All you need to do is put a stop-loss figure on the trading strategy and then you can be sure that you can get the best out of the strategy. You can find many good price action binary options trading strategies online. You just need to spend some time searching for them.

Wrong and right investments

If you have decided to go for the price action strategy games, you must keep in mind that your trading must be based on the binary option price. This means that you must only deal with the price of the particular option that you are dealing with. Do not think about other underlying options and their prices. This could lead to serious financial problems for you as you may lose lots of money from your investment.

Major factors

In order to use the price action strategy in binary option price action games, you must be very sure about your breakout or the break-out of the price. This is because the price movement of the underlying asset is affected by many factors including: 

  • Supply and demand; 
  • Political events;
  • Changes in the world and e.t.c. 

To determine the breakout, you must look at the daily chart of the price. If you find the price pattern has a distinct upward or downward trend, you must be sure that the price action strategy you have selected is right for you.

Currencies Heat Map – An Overview

Currencies heat map is very interesting to any trader. A currency options trading strategy using this technique will certainly allow for faster entry and exit times, while minimizing loss. While it is still relatively new, many experts are already using it. In fact, currency trading is one of the few strategies that can beat the markets virtually every single day! That’s a pretty amazing claim to make, but it is not an overstatement. It also makes a lot of sense.

Currencies heat map

How does it work

How does currency trading work with a forex heat map? Well, the Forex Heat Map is updated daily during the trading day, usually starting at the Options Trading session. If you’re in any discipline of scientific biology, and particularly if you work primarily with transcriptomic information, you’re probably already familiar with heat maps utilized for just about as long as there have been biological researchers. Currencies are no exception. As mentioned earlier, the Forex Currency Heatmap visualizes currency pairs in a way that highlights how they are headed in terms of price movement over time.

Fundamental analysis

This visualizer can be used for fundamental analysis as well. A currency trading strategy that relies on more options for its main ingredient should utilize the heat map to make analysis easier and more effective. How can this be done? There are actually two ways to create the visualizer: 

  • One from the trader’s own analysis of how the market is trending and moving in real time;
  • One from having an expert render a live heat map of the market using actual currency pairs.

When to use visualizer

How do you know when to use the Visualizer? The best times to use a forex market heat map are when you want to focus on specific areas of your investing or trading strategy. For example, if you’re into technical analysis of currencies, like fundamental analysis, then it would be good to use heat maps to analyze the data and tell you which currency pairs are headed in different directions. Mostly, they will have arrows pointing to the direction of movement, but sometimes you may also see a little spike in particular currency pairs. It would be best to take note of this and understand what the directional signals are. From there, you can make decisions regarding when to trade and where to set your stop loss and trade exit.

False signals and trends

What’s the catch, though? The catch is that when you use a heat map for forex trading, you get a lot of false signals and false trends. The current map is simply a tool to highlight areas in the chart that show areas of: 

  • High volatility; 
  • Trends;
  • Movement. 

As currency traders, we all want to see our trading strategies pay off, so when we see areas like this in a heat map, we want to identify the trend it is leading to and place our trades accordingly.

Online services

There is an easier way to spot these trend signals, however. That would be to use a free online service that automatically updates itself with the latest currency data from around the world. A forex currency trading program can easily spot these trends and move your trades accordingly. If you’re new to forex trading, it’s best to try a demo account first, by registering for the IQ Option, for example, as these programs do not require any risk, since they are given by real users, for free, on a trial basis.

Now, you may be asking, “If there is such a thing as a forex currency trading program, how do I find a program that works?” There are many different types of these software programs, including some that are based on a more traditional technical analysis style. They may analyze price: 

  • Pattern;, 
  • Support and resistance indicators; 
  • Pivot points; 
  • Moving averages; 
  • Retracements; 
  • Envelope patterns, etc… 

Some programs are designed specifically for different currency markets, while others are designed to spot strong and weak currencies in real-time. This makes them ideal for any type of trader, regardless of what they are trying to accomplish. Just make sure you pick one that has been around for a while and has a proven track record.

Verdict

So, if you’re interested in getting into the market quickly and taking advantage of what’s happening now, but don’t know how to get started, this may be just the solution you’re looking for. Since this information comes in real-time, you will have instant access to it. This can give you a lot of an edge, as many successful forex traders already know how to spot currencies that are about to go on a major swing. If you’re new to forex, you should definitely take advantage of this technology. If you’re already an experienced forex trader, however, you should stick to what you know and keep trading with the tools you have at your disposal.

How the Bollinger Option Strategy Can Be Used in Forex Trading

Reversal on Bollinger option strategy

Reversal on Bollinger option strategy is one of the oldest and simplest. In this strategy, the options buyer buys a call option at a lower price than its market price, then sells it back later at a higher price. Reversal strategies allow the trader to make a profit even in the absence of a market. In other words, they are perfect for those who have an interest in stock trading but are not interested in taking extreme risks. This is because they seek options that are safer than the underlying security.

Different directions

The bollinger bands in binary option strategy are used to indicate the direction of the trend. They are usually: 

  • Black; 
  • Green in color.

The lower Bollinger bands show that the asset will continue an upward trend; whereas, the upper band shows that it will continue a downward trend. This helps the trader to make an informed decision. However, when the market is unstable, the bollinger bands may not be accurate as they can be affected by extraneous factors.

Types of Boilinger bands

There are two types of bollinger bands. There are the:

  • Large bollinger bands;
  • Small bollinger bands. 

The large bollinger band is used to indicate that a long or a short position can be sustained for a period of time. The small bollinger band is used to signal the reversal of the trend.

A trader can take advantage of the low volume of the time frame by using the bollinger bands. With this information, he/she can make an educated decision. In binary trading, one can earn more if there are a high number of winning trades in a given time frame. If there are a low number of winning trades, the trader will have to incur a loss. One must also be able to determine the direction of the movement of the prices.

Websites for training

To help you become aware of the benefits of the bollinger method in your binary option trading, you can access various websites that offer training in binary options trading. These websites teach traders the techniques of trading binary options, which is very useful in helping them make an informed decision. Also broker sites like IQ option provide valuable tips that help traders know when to implement the strategies using the bollinger bands in their trading.

Direction of Trends

Traders can use the bollinger band in options trading by identifying: 

  • Bullish; 
  • Bearish conditions. 

By knowing the direction of the trends, they can decide whether to buy or sell. It is important to identify the condition that you are expecting. It is better to wait until the condition has turned out in your favor before you decide to execute your trade. This is also used as an entry signal in Forex trading and other markets.

Bollinger indicator

The bollinger band in options strategy can be used in several ways. One of these ways is to re-examine the indicator’s slope or the reversion. Slope indicates the tendency of the price action to move back or to the left. In the bollinger indicator, it can be seen that the resistance level moves towards the higher price action. Once this level is breached, the market will move in the same direction.

Predictions

The bollinger bands also indicate the trend reversals. Once the price action of the underlying asset breaks the resistance level, the reversion will show the trend reversal. Usually, the trend reversals can last for several days or for a few weeks. Traders can learn the technique of the bollinger band in options trading, which allows them to predict when the price action is about to break the resistance or the reversion level.