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Trading signals

How to use trading signals for binary options.

One of the popular services that offered by many brokers and private traders is a trading signals providing. In this article we will tell about this service a little bit more – from its description to the rules of usage.

What means the trading signals?

Trading signals are giving the expected movement of a specific asset for a specified period of time (or time-frame).

Where the trading signals come from?

The trading signals could be provided either by trading robots/automated trading systems, or by the experienced trader.
Both methods have advantages and disadvantages. As we can see from our experience and the experience of many our colleagues, robotic systems have certain drawbacks. These imperfections do not allow traders to trade successfully, once adjusting this robot. Why is this happening? It is due to the fact that the robot is a deterministic algorithm defined in advance. Do not subject to any stress or emotions. This is undoubtedly its strength. On the other hand, the predicted behavior of traders and non-standard commercial situation can’t be accurately estimated by any pre-programmed robot. For example, there is not easy to explain to the automated system, how it should react on some fundamental events, like changes in labor markets, interest rates changes, and so on.

So, before you will trade using the trading signals it is better to know, whether these signals are provided using trading robot, or trader/analysts.
The signals that we provide to our visitors are the result of hard work and careful analysis using complex combination of analysts’ strategy, the necessary package of indicators and their own experience, allowing assess the current state of the market most adequately.

What are the trading signals used for?

The main task of trading signals is to prompt the trader the most favorable terms for the trade opening and, as a result to make the trading more successful. Often, traders who are just beginning to analyze the market and make their predictions, use the signals as an additional confirmation of their analysis correctness. In such cases, the signals are either confirm or refute the assumption of the trader. The risk of deposit loss is reduced as a result of this collaboration between trader and signal provider.

Trading signals.

If you are buying the trading signals, pay attention to their key characteristics – yield. The yield should be considered not in the term of a few days or weeks, but for a longer period of time – it will give an opportunity to see an authentic picture of profitability, not just a random success.

How to use the signals for binary options?

Sometimes it happens that one trader receiving a profit, but another trader receives “out of the money” using the same signal. Often the reason of such situation is the wrong use of trading signals. On the specific example, let’s consider how to minimize the losing trades and increase the gains from trade signals.
The first recommendation is obvious – to purchase the option as soon as you receive a signal. But what should you do, if some time has passed from the signal appearance and time you saw it? Should you purchase the option?

Let’s consider a couple of examples:

Example A:
Signal EUR/USD; DOWN, time-frame – 1 hour 30 minutes.
Time of the signal is 2:01 pm (GMT)
1. As soon as the signal arrives, immediately open the trading platform and look for the asset specified in the signal. On the open graph find the price at the time of signal appearance (2:01 pm) and compare it with the price, which gives you the broker now.
2. If you see that the rate is equal or above the rate, which was at the time of signal issue, do not hesitate to purchase an option. Note: The expiration time of the option must be chosen close to the recommended time (time frame), which is listed in the signal. In our example, the right expiry time will be 3:30 pm.
3. If the current rate is lower than the rate at the time of the signal appearance, it will be better do not purchase an option using this signal. You can follow the movement of the asset for some time – if during this period the price for the asset will be equal or above the rate of the signal appearance, you can purchase the option according to this signal. But do not forget that the expiry time should be 3:30 pm.

Example B:
Signal EUR/USD; UP; time-frame – 1 hour 30 minutes.
Time of the signal is 2:01 pm (GMT)
1. As soon as the signal arrives, immediately open the trading platform and look for the asset specified in the signal. On the open graph find the price at the time of signal appearance (2:01 pm) and compare it with the price, which gives you the broker now.
2. If you see that the rate is equal or below the rate, which was at the time of signal issue, do not hesitate to purchase an option. Note: The expiration time of the option must be chosen close to the recommended time (time frame), which is listed in the signal. In our example, the right expiry time will be 3:30 pm.
3. If the current rate is greater than the rate at the time of the signal appearance, it will be better do not purchase an option using this signal. You can follow the movement of the asset for some time – if during this period the price for the asset will be equal or below the rate of the signal appearance, you can purchase the option according to this signal. But do not forget that the expiry time should be 3:30 pm.