There are only 2 kinds of people: the ones who prefer fundamental analysis and those who trade with the technical tools. Each approach has its own merits but today we would like to tell you about one of the most popular technical indicators in the binary options world.
Understanding of how the market prices move can be very tricky sometimes, but there are things around that can make this process easier for you. So, with the help of only one technical indicator called Moving Average, you can predict where the trend will be going next. Sounds good, doesn’t it?
The main goal of this indicator is to help every trader to track the current market trends and win more. Checking with the indicator displayed directly on the chart, the direction of the trend becomes clear and you can use it in your next trades. Wisely combined with your best working strategy, it can bring you far better results.
Depending on your preferences, 2 kinds of the moving averages can be successfully applied to your strategy. The first and the easiest one is the Simple Moving Average (SMA), which basically covers closing prices for the chosen number of days and filters it to the average to cut fluctuations and noise. Although the SMA is one of the best and simplest indicators there is, many traders prefer to trade with its improved version the Exponential Moving Average (or EMA). The main difference and some sort of improvement of the EMA are that it gives more weight to recent prices, which automatically makes it more responsive to new information, therefore it’s very flexible.
Both indicators are very easily customised and can be combined with the others depending on what is the whole picture that you would like to see. The most popular combination among the traders on Ayrex is EMA3 and EMA9 put together.
Take your trading skills to the completely new level by using Moving Averages and Bollinger Bands in the latest version of our Android app!