Indicators and oscillators for binary options trading

Ted Capwell

When working in financial markets with the help of any technical trading tool, the investor needs to solve one basic task – to correctly predict the price movements of the underlying asset. It is an effective forecast, calculated by a set of indicators, can bring a market contract for profit. In this issue, binary options are certainly not an exception. In the trading algorithm itself, the binary option is the rate, specifically on the direction of the market, therefore forecasting and analysis here are the most important technical point of profitable trading.

To generate high efficiency forecasts for trading, professional and private traders use a wide range of tools, the main technical tools in this list are indicators. These specialized services are able to automatically evaluate the technical indicators of the price and form on their basis visualized and relatively accurate signals for opening trading rates. It is the automation of technical analysis that makes indicators such a popular tool for analysis. However, in professional trading options, as, indeed, in other areas of stock trading, there are a lot of skeptics who talk about the ineffectiveness of automatic indicators.

Undoubtedly, indicators give advantages to the trader, but at the same time in the trading environment there are many opponents of these funds. They give a completely logical justification for the inefficiency of indicators, which we simply have to talk about. The fact is that any algorithm for automatic market valuation is nothing more than a reflection of past market indicators or a projection of smoothed market movements. Therefore, as skeptics of work on indicator systems believe, there are simply no methods on the market that can generate forecasts based on indicators for future market movements. The dispute over the performance of indicators has been going on for a long time, and so far traders who are actively using market appraisal programs in their trade win this issue – and this is confirmed by their trading result.

In general, it is worth noting that even the technical rationale for the work of automatic tools, which skeptics lead, allows you to get fairly effective trading indicators when working on indicator strategies. Even the projection and accounting of past market indicators allow making effective conclusions about the development of market trends, which is a signal for trade.

We moved away from the main topic of the article, and decided to discuss professional opinions of investors is not accidental. Analyzing the work of indicators and oscillatory market analysis services in binary trading, it is necessary to talk about the advantages and disadvantages of tools so that potential users can clearly understand the positive and negative factors of work for certain services. We offer you a list of standard and highly effective indicators, which are most often used in binary trading. And the choice of the most attractive and convenient for trading – is yours.

Indicator MA

High-precision trend indicator – Moving Average. In the algorithm of his work he uses the average statistical values ​​of the asset value in the period of market fluctuations established during the settings. Thus, the indicator in automatic mode generates a dynamic level of trend movement on the chart, which identifies trends directions of any construction duration. In the principle of market analysis, this service imposes the market’s desire for balance, that is, the quotes of the asset, despite impulses and trend movements, always tend to balance at a certain level. This makes the indicator work technically sound and accurate in terms of generating forecasts.

Classical signals when using the average in binary trading are:

• The direction of the construction of the indicator moving, which determines the current trend

• Breakdown of the indicator level by quotations of the asset in a certain direction. This signal format characterizes the reversal of the price trend.

Indicators and oscillators in binary options trading

In this simple way, traders can generate signals on the chart with relatively high forecast accuracy.

Benefits of the service:

• Simple operating mode on the liquidity chart

• Formalized signals

• Availability

• Relatively good efficiency


• On narrow market valuation ranges, the indicator is not able to react quickly to price movements

• For a long evaluation period, the indicator signals are significantly delayed

MACD indicator

The main algorithm of this indicator is combined analysis approaches. Here, with the help of different periodic moving averages that make up the oscillator part of the indicator, signals of the turning points of trend movements are formed, and the direction of such a fluctuation is determined. In addition, the MACD indicator has a histogram – its task is to determine the impulse strength of trend market fluctuations using a complex calculation model. This indicator is used in high-frequency trading options with a narrow range of expiration. As a set of signals, it is customary to identify such service indicators:

• Crossing removals among themselves in a certain direction

• Breakdown of the centerline of the technical scale of the indicator by oscillator lines in the direction of a new trend

• The indicator of the divergence of the oscillator lines between each other

• The histogram columns are raised or lowered relative to the zero level and the histogram of the level indicator 0 intersects.

In addition to the classical signals of the instrument, a set of specific indicators is proposed here, which can also be considered as signals of the MACD strategy:

• Construction of trend levels with oscillator lines

• Divergence of the oscillator – the discrepancy between the direction of movement of the indicator lines and the market movement of quotations

Binary options indicators

This list of technical indicators allows you to maximize the amount of information on the market situation on the chart of quotations and generate an accurate forecast on market trends.

Advantages of the indicator:

• Rapid reaction to market movements

• The widest possible range of signals and estimated indicators

• High efficiency at work on all ranges of market valuation


• Late reaction in the time of high, impulsive market volatility

• Increase in the number of false signals on the minimum market ranges

Indicator of Bollinger Wave

The analysis tool is a mode of combined use of 3 moving averages, where the standard deviation of removals is applied. This technical tool allows you to form on the quotations of the asset dynamic price corridors of fluctuations in the asset market. At the same time, the Bollinger Wave indicator allows you to obtain a large amount of information for analysis: the level of market volatility, the boundaries of trend fluctuations, the points of price reversals in the formation of new trends or corrective movements.

Classical signals of the indicator are considered to be:

• Bounces from the boundaries of price corridors

• Intersection of the centerline of the indicator when the direction of the trend is changed

• To determine the level of volatility of the current market trend, divergences of the indicator’s boundary lines relative to its central moving

oscillators for binary options trading

This type of indicator generates signals with a forecast accuracy of up to 90%, which leads the user to a high level of technical results in the binary market.

Benefits of the tool:

• Clear signals that determine the turning points of the market

• Good level of reaction to global trend reversals

• Highly effective forecasts


• A large number of false technical forecasts for flat movements of quotations

Alligator indicator

The service, created by the recognized financial market authority Bill Williams, is a classic indicator analysis tool. In his technical algorithm of work, the adoption of the use of different periodic and multi-format moving averages is incorporated. When the tool is working, traders can clearly identify how the trend movement zones, as well as moments of flattening and consolidation. This list of indicators makes it possible to clearly identify coins for the emergence of trend oscillations, which is an effective signal for the design of binary options. The classic indicators for trading on the indicator are the turns and intersections of service removals with each other in a certain direction:

Indicator Alligator is considered a classic high-precision tool for analyzing quotations when trading in a binary market, and allows you to get the highest possible trading results.

Benefits of the service:

• Formalization of signals

• Accuracy of reaction to trend movements of the market

• Relatively low false signals


• A belated reaction to the increase in volatility, which is demonstrated by the market with the emergence of fundamental drivers of market movement

RSI indicator

A technical tool whose task is to define a wide range of indicators: the relative strength of the trend movement, the direction of the trend, the zone of market extremes (the level of oversold and overbought assets). This set of indicators allows us to use the indicator RSI as an independent highly effective strategy. The signals of the RSI indicator are:

• Crossing the levels of extremes of the market by moving an indicator

• Directivity of construction of the trend line of the technical means of analysis

• Divergence

All you need to know about oscillators and indicators for options trading

It should be noted that the RSI indicator is often used in trading strategies as a filter for false trading signals of other indicator analysis tools.

Benefits of the service:

• Large volume of market indicators

• Informative signals

• Accuracy of forecasts

• Easy operation of the service


• In moments of low volatility of the market and the flat, the service provides many false trading signals

In principle, this is a fairly comprehensive set of automatic indicators for creating highly professional and accurate trading strategies, which are most often used by traders in the binary market. All the rest is derived from these technical means.

It is worth noting that, despite the effectiveness of these tools as mono-indicator market assessment systems, professional investors use them as tools for creating highly specialized highly effective strategies. Simple combinations of this list of indicators and the use of authoring settings based on their own experience in trading make it possible to form an infinite number of trading systems for binary trading.

Let’s follow simple example.

When an asset of a simple analysis tool set consisting of the SMA trend indicator and the MACD and RSI oscillators is installed on the liquidity schedule, we get a classic strategy for high-performance trading in the binary market. At the same time, the template for markup graphics has a simple and understandable mode even for the beginner:

Trading tips: oscillators and indicators

The signal system of this strategy also has a simple formalized regime and allows you to receive up to 86% of the effective rates while operating on the market, which enables investors to expect a stable and high financial result:

What are Trade Indicators and Oscillators?

We offered you an optimal set of effective indicators for creating trading strategies of any complexity and efficiency. Of course, the full list of the indicator tools available today in the network includes hundreds of titles, dozens of approaches for assessing the market and allows you to create an unlimited number of trading systems. You only need to make a choice and experiment to get the best possible result.



“General Risk Warning: Binary options trading carry a high level of risk and can result in the loss of all your funds.”