Nowadays, the binary options platforms have become online based and they do not rely on the provisional indicators that the foreign exchange platforms contain. However, it is quite possible to use the same set of indicators that are used in foreign exchange platforms so as to analyze the trades and use them in the binary options markets as well. Apart from these indicators, the traders can also use custom made indicators specifically for assessing the MT4 charts and obtaining signals to use the same for binary options market. In binary options there are some default indicators including RSI, Stoch oscillator as well as MACD indicator that are typically found in MT4 platform. These indicators have got many uses and they function in different ways. If you are adapting these indicators for the assessment of assets then it is very important to consider the type of the trade the trader is indulging in. Following are some of the most common indicators along with the various types of trades for which they can be used.
a) Bollinger bands: These are commonly used indicators that work over a wide range of binary options when they are combined along with an overbought or oversold indicator.
b) Stochastics oscillator: These indicators can be used when an overbought or oversold indicator combines with Bollinger band for a wide range of options. Ideally used when the assets involved in range bound.
c) RSI: RSI or Relative Strength Index reveals the strength of a particular trend and thus is ideally for trading the Touch or No-Touch trade.
d) Parabolic SAR- If you want to detect the reversals in market then this is an ideal indicator for you. This indicator helps to pick up signals quite late and so you must combine it with other indicators including reversal candlesticks or ADX.
e) Pivot calculator Even though it is just a custom indicator, its widely used with various other default indicators to detect signals for the range of options including, Touch / No Touch options & Call or Put options.
f) MACD: This is a great indicator to detect the divergence in the price. To make this indicator more effective you must use it along with Call or Put options along with the long expiry time.
These are some of the most common binary options indicators that are used. It is up to the investor to assess the use of these indicators and try them out so as to obtain the best mix.
Source by Ash Rock Khan