Twenty new indicators have found their way to the IQ Option trading platform with even more to come in the nearest future. New indicators may help you squeeze the max out of your trading efforts and improve the quality of technical analysis you are able to conduct.
First, why do people care about indicators? Isn’t it easier to look at the price chart and make a decision based on the price alone (since every market operates based on the principle of supply and demand)? Not necessarily. Yes, it is possible to trade with no indicators at all, and some traders do so. However, for those of you who want to get an edge against the market and see the whole picture, indicators might be the right tool to use.
As of now, all indicators are divided into several groups based on their function and underlying mechanics.
This category is a mishmash of all the indicators that IQ Option traders enjoy the most. Here you will find the indicators you are already accustomed to.
According to Merriam-Webster, the momentum is the force that allows something to continue or to grow stronger or faster as the time passes. We say that the asset price gains momentum when it grows at an accelerating rate. When the price growth rate decreases, we say that the asset is losing momentum. Momentum indicators excel at identifying rapid price movements and can hint at a possible trend reversal.
New indicators in this category include Aroon Oscillator, Balance of Power, Center of Gravity, Klinger Oscillator, True Strength Index, Williams’ Percent Range, Woodies CCI.
Why does one need a dedicated indicator to spot a trend, you might ask? Isn’t the chart enough to see where the price is moving? Both yes and no. It is in fact enough to look at the price chart to determine the current direction of the price movement. However, as always in trading, if you want to get more details, you should consider using additional tools. For example, trend-following indicators can help you get rid of the price noise.
New indicators in this category include Aroon, Mass Index and McGinley Dynamic.
Volatility is the measure of the speed of the price change. High volatility corresponds to a rapidly changing price. Conversely, low volatility demonstrates that the asset price doesn’t fluctuate that much. The higher the volatility, the higher the risk. As always in trading, higher risk corresponds to the higher potential return. It is, therefore, useful to know when to play it safe and when to engage in riskier deals.
New indicators in this category include Average True Range, Chaikin Volatility, Donchian Channels.
Moving Averages smooth out the price chart and make the trend more obvious and easier to spot. When several moving averages with different settings are combined, they can turn into a powerful trading system capable of indicating optimal entry and exit points. Moving Averages can also be used as a complementary tool for other indicators.
New indicators in this category include Arnaud Legoux Moving Average, Kaufman’s Adaptive Moving Average, Least Squares Moving Average, and Rainbow Moving Average.
In trading, volume represents the number of deals executed at a given moment of time. The higher the volume, the more people are buying\selling the asset simultaneously. Volume is an incredibly important indicator, as it can help predict future price movements and potential reversal points. Unlike other indicators, volume doesn’t use the information already present on the price chart.
New indicators in this category include Net Volume, Volume Oscillator and Weis Wave Volume.
In this section you will find all other indicators that do not fit into the above-mentioned categories. It doesn’t, however, mean that they should be neglected, as you will find most of them useful.
New indicators in this category include Chande Kroll Stop and Coppock Curve.
Soon we will publish a series of articles dedicated to new indicators, going into more detail than this brief overview. Write in the comments what indicators would you like to see covered first. And don’t forget that you can go to the platform and give them a try.
NOTE: This article is not an investment advice. Any references to historical price movements or levels is informational and based on external analysis and we do not warranty that any such movements or levels are likely to reoccur in the future.
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