"Speedometer" - new indicator in vfxAlert
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If there are many indicators on the chart, this does not help much to understand how binary options signal work. Analyzing several oscillator charts simultaneously, the Moving Average movement, and the dynamics of volume changes requires experience. There is a lot of information; it is easy to make mistakes if you are a beginner. With short-term options, there is simply no time for this. The “Speedometer” indicator of the new version of vfxAlert will help you quickly see the current situation and make the right decision. Setting the indicator. Forex and cryptocurrency currency pairs are available:
The size of the indicator panel can be adjusted. To do this, click on the top border of the panel and set the desired width. The following information is displayed:
Timeframe. We look at the «Summary» data for larger and smaller time intervals. A proven method of technical analysis: if the market direction coincides, it reinforces binary options signals. If the direction is different, we stay out of the market!
Bulls&Bears. Who is stronger in the market: buyers or sellers? The calculation is based on the standard Bulls Power and Bears Power indicators. Indicators are available in all popular trading terminals. Restriction: they give false signals after the release of strong fundamental news or speculative actions of market makers. Use data only on a "quiet" trend and expiration of 2-3 hours.
Pivot Points. The calculation is based on the high, low and close (Close) of the previous day. Three levels above the Close price will be resistance levels (R1-R3), below support (S1-S3). From them, the price can reverse or continue the trend after breaking through. There is a greater likelihood of a rebound from R3/S3 levels look at the chart, other indicators and chart patterns!
Oscillator. All exact binary options strategies must determine the onset of market overbought/oversold conditions after which the trend reverses. «Speedometer» uses:
RSI. Trend indicators must necessarily be confirmed by at least one oscillator indicating an overbought when buyers can no longer move the price up, or oversold where there is almost no one in the market to sell at lower prices.
Commodity Channel Index (CCI). Shows the dynamics of price movement or how fast the current trend is growing or ending. As you know, the price of all trading assets (currencies, stocks, futures, indices) moves cyclically between local maximum/minimum.
• Volatility. Determined by the ATR (Average True Range) indicator. The closer to «High» the greater the probability of a trend reversal, near «Low» the trend ends and we look at other binary option trading signals.
• Trends. It works by Moving Average and shows where the market can go for the next 10-15 bars of the selected timeframe. We always confirm the direction with other «Speedometer» signals.
Example of a strategy using "Speedometer» The chart shows two Simple Moving Average (SMA): "fast" with a period of 5 (yellow) and "slow" with a period of 20 (blue). The first opening signal will be their intersection:
• CALL-option. The fast SMA crosses the slow one from top to bottom.
• PUT-option. Opposite conditions: the fast one crosses the slow one from the bottom up.
Moving Average has the largest delay among the tools of technical analysis. Additional confirmation is required: "classic" binary options strategy use overbought/oversold oscillators. "Speedometer" contains two oscillators: RSI and CCI, they are enough to confirm the intersection of MA.
Why two indicators, why also the USD/CAD pair? The answer is simple: to further filter false signals. These pairs have an inverse correlation: if the EUR/USD an uptrend, the USD/CAD downtrend, albeit with a lag. Now the Forex market is less predictable than 2-3 years ago, correlations can be broken, but most of the trading day it works.