Option binary trading indicators , forex trading indicators and stock trading indicators

There are too many good indicators available in market , here we are going to discuss about some good indicators. These indicators will help you to maximize your profitability and enhance your trading knowledge. Indicators basically shows the current price and moves of market stock and indices.

Now let us discuss few important indicators for option trading. So first of all we need to know what is option trading? how option trading works ?

Option trading is used for investment sector like equity, commodity, indices or currency. Indicators shows the top gains and losses in indices , currency and stock.

Options are of two types call/up or put/down. The trader predict that the price will rise for a certain period of time he bet for upward direction. The trader predict that the market price will rose/decrease from current price that trader open a bet for downward direction.

There are several indicator available in the market to predict candles movements and prices. Lets see the list of trading indicators here :

Technical indicators shows the patterns and possible moments. to learn option trading indicators we must know the major indicator i.e. Lagging indicator and leading indicator.

LAGGING INDICATOR :

Lagging Indicator shows the stock price pattern. Its information depends upon the past information. these indicator shows an extremely solid downtrend. it inform us a new starting of trend and a reversal pattern.

LEADING INDICATORS :

lets learn some basic indicators :

* RSI - RELATIVE STRENGTH INDEX

* BOLINGER BAND

* ALLIGATORS

* MOVING AVERAGES

* MACD- MOVING AVERAGE CONVERSIONS AND DIVERSIONS

* MFI - MONEY FLOW INDEX

Now we will learn about these indicators one by one . HERE

What is RSI indicator ?

Relative strength index is one of the most popular indicator for binary option trading. it is mostly used by a momentum trader. The value of RSI varies in between 0 to 100. it has a middle layer of 30 the indicator showing above 70 label line is called overbought and below 30mlable line called oversold.

------------------------------- 70

------------------------------- 0

------------------------------- 30

Generally , most traders take a buy call when the RSI indicator indicates above 30 and traders make a sell position when its below 30 level.

What is Bollinger Band ?

Bollinger band is also a most popular indicator for binary option trading. Traders use this indicator to know significance of volatility. Bollinger band is a combination of three SMA's . it indicates the breakout of price.

A price moves outside the Bollinger band indicates the signal for a reversal and option traders act and make position accordingly. In shot we can say that, the price closer to the upper band , the more overbought and the price closer to lower band , more oversold. The price moving closer to the lower band indicates the longer call.

What are moving averages ?

The simplest application of moving averages to your trading would be to look for price
to penetrate the moving average. In the chart below, we see four examples of the price
penetrating a 40 period SMA. This is known as a “whipsaw” and it is common with moving averages. We will discuss whipsaws in more detail later. Example B shows price penetrating the moving average to the downside and a strong downward trend follows. And finally, in example C we see price penetrating the moving average to the upside, indicating the beginning of a strong
upward trend.
Since moving averages are lagging indicators, the application of two moving averages will result in later signals, but it will help reduce whipsaws. Let’s look at an example of using two moving averages. We have applied a 15-period Simple Moving Average and a 40-period Simple Moving Average to the same chart as before. If we are to take a
position in the direction of the faster moving average (15-period) when it penetrates the slower moving average.

Trading Indicators