MACD Strategy for Binary Options
This MACD professional trading strategy is based on the combination of MACD oscillator, Exponential Moving Average (EMA), and Parabolic SAR. This is one of the best IQ Option strategies used by many traders to increase their profitability.
Unitedly, these technical indicators produce high probable trading signals that help you interpret the latest trend, and help traders enter a buy or sell position just in time. This combination of indicators has been successfully used by many traders to get profitable results. You can use this strategy to double your IQ Option Account. Quotex traders can also use this combination of indicators as a strategy to double their accounts.
Details of the Indicators used for IQ Option MACD Trading Strategy
- The (EMA) Exponential Moving Average used to smooth out the price fluctuation and give an idea of trends based on the 14 periods EMA.
- The MACD indicated the direction and strength of the trend. It has a bar graph, MACD line, and a signal line.
- The Parabolic SAR indicator verifies the trend’s direction at a higher acceleration and gives a double confirmation about the price reversal.
Risk Warning: Your capital is at risk. Never invest the money you can’t afford to lose.
How to Configure the MACD Binary Options Strategy with IQ Option and Binomo?
Configure your charts, as shown below. The chart selection is shown with IQ Option trading platform. You can configure the chart with the Binomo platform in a similar way.
STEP 1
Select the Japanese candlesticks chart and choose a time period of 1 hour. The recommended time frame for the trading strategy with this approach is 1 hour.
Click on the indicators button on the bottom left corner of IQ Option platform and select MACD, EMA line, and Parabolic SAR to the diagram. The steps are shown on the below screenshots.
Now pay attention to the chart for signals. When the Parabolic SAR dots surface above the price lines, it indicates a bearish trend. When the dots surface below the price line, it shows an upward trend.
How to interpret the charts – How to use this Strategy successfully for IQ Option and Exnova?
Before hitting the green BUY button or UP Button, authenticate that you have an upward trend.
- Verify that the candle crosses through the EMA line and closes above it.
- Parabolic SAR dots are formed below the price candles.
- The MACD line (blue) crosses over the signal line (Amber) in the upward direction.
When you can verify the price direction by confirming all the above conditions, pause until the end of the present candle. Place the BUY trade or UP trade at the start of a new candle with expiry equal to double the time frame. If the chart is set at a 1-hour time frame, the trade expiry should be 2 hours.
Before you go for a SELL or DOWN trade, ensure the following three conditions of the indicators.
- The price candle (Red candle) crosses down through the EMA line.
- The MACD line (blue) crosses the signal line (amber in a downward direction.
- Parabolic SAR dots are formed above the price candles.
Don’t rush to the trade though, wait for the MACD lines cross and wait for the present candle to finish. Then check all the three indicators and place a trade at the start of a new candle with 2 hours expiry.
How to avoid losing money while using this strategy?
- Do not initiate a trade based on only one signal; the signals from all three indicators must agree before you place a trade.
- The trade expiry must be double the time frame used on the chart. If you apply the 1-hour chart, place the trade with expiry after 2-3 hours.
- This strategy works well in the European and US trading session. Avoid using this strategy during news events and in the Asian trading session.
- Never trade more than 5 to 10 percent of your account in any single trade. Always study your trades and plan your risk strategy based upon your success rate.
