Strategy Based on 3 Indicators “Chandelier”

Combination of oscillators, trend and hybrid binary options indicators is traditionally very popular among traders. In such a combination, instruments reveal their potential for binary options trading in the best possible way. The pattern is the basis of a large number of strategies.

However, the final effectiveness of the signals depends on the specific type of indicators used, so the combination must be assembled competently. In this article we will review strategies “Chandelier”, which is based on two standard indicators and one custom indicator available in the “Live Chart TradingView.

 

Review of indicators

Chandelier Stop – an interesting solution from an active member of the traders’ community. This is a modified version of Chande & Kroll’s Stop. This tool is used to determine the stopping points of the price movement and its reversal, similar to Parabolic SAR. Chandelier Stop consists of a set of points connected by a line. The elements are built on top of the price bars on the graphic or from the bottom. When the points are on top – it signals the predominance of downward movement in the market, on the bottom – the upward movement is active trend. The key signal is the point where the line crosses the chart.

Wonderful Oscillator Bill Williams – the name speaks for itself. At the heart of this oscillator for binary options there are two curves SMA with a period of 34 and 5. The formula subtracts the value of the larger line from the smaller one, and the result is displayed as a bar graph. The height of the bars shows the distance between the two SMAs. There are similarities in the principle of operation MACD. However, if we compare the values of the two indicators, the Awesome Oscillator will show a smaller lag, but its accuracy will be lower. This is typical for all oscillators.

Bollinger Bands – tool, visually displaying the distance between the outermost lines limiting the Bollinger Bands price channel. This indicator shows the level of market volatility. The wider the channel, the more pronounced the current trend movement. Narrowing indicates a decrease in volatility, fading trend. The optimal moment to enter the market is the beginning of the Bollinger Band widening.

 

Preparing to trade on the strategy

The modern approach to online trading differs from the traditional forex. Whereas in the past trade and technical analysisThe opening of trades is performed in a special program, and now different platforms are used for this purpose. The opening of transactions is made in a special trading terminaland market analysis – with the help of a separate platform, adapted for this purpose as much as possible. The optimal service for theanalysis is “Live Schedule.” from TradingView, and for trading – any trading platform from the rating Binary options brokers of our website. A good choice for beginners is INTRADE.BAR (site).

Step-by-step instructions:

1. Open TradingView and INTRADE.BAR (or another platform) in the adjacent browser tabs or put two windows side by side (for computers with big screen).
2. In both windows we set up the chart in the same way – asset, timeframe of 1 minute, chart candlestick mode.
3. We add three indicators to the TradingView chart: “Chandelier Stop”, “Bill Williams’ Wonderful Oscillator” and “Bollinger Bands”. Copy the names without quotation marks and paste them into the search line.
4. In the Chandelier Stop settings, set the red and green fill color of the elements, and make the thickness of the lines as thick as possible. In the Miracle Oscillator settings, change the histogram type to “Columns” (see screenshot above).

The last step can be skipped, but the default settings make it very difficult to visually recognize signals because the elements are too small.

 

Trading signals

The main indicators in the strategy are Chandelier Stop and Awesome Oscillator, and BBW is used as a price filter.

A signal to go up – the candlestick chart overcomes the line, as a result of which it changes the fill color from red to green. The Awesome Oscillator histogram similarly crosses the zero line. Confirmation is the beginning of growth in the BBW (Bollinger Bands) window.

Down signal – Chandelier Stop color change from green to red, the beginning of the construction of negative bars on the Miracle Oscillator bar chart, and the beginning of the Bollinger Channel expansion.

 

Conclusion

Entering the market is carried out by the synchronous signal of the 2 main indicators of the strategy. If the expansion of the Bollinger Bands channel begins on the signal candlestick, it is necessary to open a deal in the corresponding direction. The duration of the transaction should be equal to 4-5 candles. On the intrade.bar platform the term expirations is set just before entering the market.