The trading strategy for binary options EMA is based on the performance of several technical instruments:
- Stochastic in the Color modification - acts as a filter for trading signals, which determines the actual price rebound from the channel boundaries;
- EMA_Cross – provides trading signals that are formed when exponential moving averages cross;
- bands—forms a trading channel based on Bollinger Bands indicators.
What assets is the strategy suitable for?
Due to the fact that this strategy for binary options is based on complex indicators of several signals, the system can be used to trade any assets. However, it is recommended to work with EMA only during the American and European sessions , setting a time frame not lower than M15 and an expiration date of one candle (15 minutes or higher).
Setting up an EMA strategy in MT4
The software product is installed using a standard algorithm. After unpacking the archive, the MQL4 folder should be moved to the OpenData Folder, and then reboot the trading terminal. At the end, you need to launch a chart of a suitable currency pair and download the template of this system, setting the timeframe according to the recommendations given.
How to open trades to buy a CALL option
Trading within the EMA strategy is quite simple. Call options must be purchased if the following conditions are simultaneously met:
- the price has dropped at least to the lower channel line (or breaks it completely);
- an upward arrow appeared on the price chart;
- The Stochastic indicator line turned blue.
! It is important to open a trade not when the arrow appears on the chart, but when all three conditions are met. Buying a CALL option usually occurs on the next candle after the arrow appears.
How to open trades to buy PUT options
Transactions with the Put option are opened with other indicators:
- the price has at least touched the upper channel line;
- an arrow pointing down appeared on the price chart;
- the Stochastic line changed color to red.
Finally
This trading strategy is more suitable for working with binary options , but some traders apply this system to currency pairs when trading on Forex . The essence of EMA Crossover is that signals for binary options form exponential moving averages, and then the readings of this indicator are filtered by two additional technical tools.
When applying this strategy to currency pairs on Forex (or binary options), it is important to trade with a reliable broker who does not delay quotes and does not underestimate trade odds. Be sure to use our broker ratings and choose a reliable broker for trading in the financial markets.
Download the EMA strategy template and indicators
Can't figure out how this strategy or indicator works? Write about it in the comments to this article, and also subscribe to our YouTube channel WinOptionSignals , where we will definitely answer all your questions in the video.
See also:
Free signals for binary options online
The best indicators for binary options
How to choose a binary options broker
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