RSI Indicator Signals
RSI indicates trend strength. However, according to RSI, we will not look at overbought or oversold price levels, as it is often done, but at prices direction because indicator’s figures coincide with the testimony of the price trend. The key note in this binary options trading strategy is the 50 mark. If the RSI is above this mark – the trend is bullish, if below – bearish.Terms of Call option buying occur if RSI value is higher than 50 but lower than 70. In the opposite side, if RSI is situated between 30 and 50 we recommend to buy Puts.Stochastic Indicator SignalsStochastic is an oscillator type of indicator. It is also a very well-known tool for technical analysis. The direction of Stochastic oscillator also coincides with the direction of the price movement.
Another important indication for us is to find the stochastic in the channel between 20 and 80. This let us know about the existence overbought or oversold asset.