Indicator Heiken Ashi for trading binary options

Today, the Heiken Ashi candle enhances overall signal development and eliminates false breakout signals. It does this by working with the average price values from two time periods.

As such, a Heiken Ashi candle is a better indicator of trade than your standard candle. This candle uses long-term data to update its price chart, so you can be sure of a more substantial price trend.

The breakouts that you get from the Heiken Ashi candles offer data since it has been collected over a longer period. As such, the Heiken Ashi trading strategy is focused on long-term price trends.

This also means that short-term price fluctuations are missed by this candle. This might not be okay for binary options, which are short-term trading instruments. Also, keep in mind that the Heiken Ashi strategy does not display signals like daily closing prices or price gaps.

As such, you don’t need to download any plugins to use this chart for binary options.

How Do I Set up the Heiken Ashi Candle Pattern Indicator?

You can easily use this trading indicator on any trading platform. To do this, you just need to follow the guide below:

1. Log into your forex trading platform.
2. Click on the “Candle” option to change your trading candlestick. Select “Heiken Ashi” from the available options.
3. Now that you’ve set up the trading environment, the next thing is to wait for a suitable opportunity. When you recognise one, select your stake and the contract length, and you can start trading.

You can read this indicator by following the guide below.

• Long, filled red candles with no shadow or a small shadow: Indicates a strong downward trend in the price of a trading asset.
• Long, filled green candles with no shadow or a small shadow: Indicates a strong upward trend in the price of a trading asset.
• Red or green candles with a short body and large shadow: Indicates a weak and insignificant trend.
• Red or green candles with a short body and short shadow: Indicates a sideways price movement and little or no price trends.
• Red or green candles with a short body and long shadows from above and below the candle’s body: Indicates a trend reversal.

• Strong trends
• Reversals
• Sideways movements

We’ll show you how to use the Heiken Ashi indicator and what to do whenever you encounter such situations.

Strong Trends

Strong trends in the trading market are identified by a long, filled candle with little or no shadows. An upward trend is indicated by the green candle, while a downward trend is indicated by the red candle.

Rob Smith once said “Buy things that are going up. Sell things that are going down. And when they stop, get out!” Ironically enough, this applies well for this trading indicator. The upward trend is a good “buy” indicator, while the downward trend is a good “sell” indicator.

This means that you can open a short-term trading contract during this period of time. This trading contract can last from 2 minutes to 60 minutes.

Reversals

A reversal is indicated by a candle with a short body and long shadows, above and below the candle. Reversals take time to occur, so they’re best suited for a medium-term trading contract. However, you’ll enjoy better accuracy when you analyse the historical price data to ensure that it’s a reversal.

Sideways Movements

Taking advantage of the sideways movements of this indicator requires you to use a binary options trader that supports it. Sometimes, sideways movements can also be confused with false movements. So, you cannot use the Heiken Ashi indicator on its own here; you’ll have to pair it with other tools.

Some of the tools that you can use for sideways movements include the Relative Strength Index (RSI) and Bollinger bands. Sideways trading, which is characterised by a lack of volatility, requires short to medium-term trading contracts.

When you use this trading strategy for binary options, you enjoy the following benefits:

Beginner Friendly

The best Heiken Ashi indicator is one of the most basic indicators out there. So, it requires no technical knowledge, which makes it great for beginners in the trading market.

Universal Availability

You’ll find this indicator on all trading platforms. So you can use it on the most basic platforms to advanced MetaTrader 4 and Meta Trader 5 platforms. So, you won’t need to stress yourself trying to download or set up complex plugins.

Universal Usage

This indicator doesn’t just work well for binary options trading; you can also use it in other trading markets. So, you can use it for leveraged forex, cotton futures, or spot BTC. In any trading instrument where it works, the Heiken Ashi indicator is great for eliminating false signals.

Efficient Signal Screen

The Heiken Ashi indicator has a broader range of data than most trading indicators on the market. This means that false breakout signals can be singled out with ease.

Combines Well with Other Indicators

This indicator works well alone, but you can also increase its capability by combining it with other indicators. This way, you can analyse more complex indicators and even make up for their inability to indicate short-term signals.

Some of the disadvantages that you have to come to terms with when using this trading strategy include:

Inadequate Details

While the Heiken Ashi indicator offers a great data range, it doesn’t offer much data detail. This simplicity makes it usable for newbies to the trading scene, but also makes it somewhat inefficient.

Terrible in Short-Term Trading

Heiken Ashi candle indicators are geared towards long-term trading plans. However, this makes it bad at short-term trading, as it can’t capture short-term momentum movements.

Price Gaps Are Not Shown

Many traders use price gaps to better capture price movements and make better predictions. However, the Heiken Ashi candles indicator doesn’t capture price gaps. So, it’s terrible for traders who are used to this style of trading.

Price Data Is Not Seen

The Heiken Ashi candle pattern indicator works with an averaging effect. So, price data is lost when working with this indicator.

While many people consider it a better indicator than the original, you can’t use it without the original. A smooth Heiken Ashi indicator is included as an overlay on the traditional Heiken Ashi indicator. So, the Heiken Ashi smoothed indicator plots the original one as a moving average.

How to Use Heiken Ashi Smoothed Indicator

This modified Heiken Ashi candle works in the same way as the original. Upward price trends are indicated by green candles, while downward price trends are indicated by red candles.

How to Trade with Heiken Ashi Smoothed Indicator

Trading with this indicator is also similar to the original. Two or more green candles in one direction indicate an upward trend and a “buy” signal. Two or more red candles in one direction indicate a downward trend and a “sell” signal.

How to Trade Forex with Heiken Ashi Indicator

Trading forex with the Heiken Ashi indicator works the same way it does for binary options. “Buy” signals are gotten from upward price trends, while “sell” signals are gotten from downward price trends.

What Indicator Substitutes Heiken Ashi Candles?

You can use your traditional Japanese candle whenever you don’t want to use the Heiken Ashi candle.

How to Use the Heiken Ashi Smoothed Indicator for MT4

Click on the trading platform’s “insert” menu to use the Heiken Ashi MT4 indicator. The Heiken Ashi smoothed indicator for MT4 is located under “Indicators.” Select “Custom” from the available options, and then you can select “Heiken Ashi.”

How to Apply Heiken Ashi Indicator to Ninjatrader 8

To apply Heiken Ashi in Ninjatrader 8, check the “bar” and “chart” sections. There, you’ll find it among the available options.

What Is a Good Indicator to Use with the Heiken Ashi Smoothed Indicator?

Moving averages, Relative Strength Index (RSI), and Bollinger bands are good indicators that you can use with Heiken Ashi.

What is the best Indicator to Use with the Heiken Ashi Indicator?

The best indicators to use with Heiken Ashi are the moving averages, RSI, and Bollinger bands. It’s all dependent on your style of trading.

How to Use Heiken Ashi Indicator

To use the Heiken Ashi indicator, you need to log into your trading platform and select this candle. After doing this, you can start trading.

Conclusion

The Heiken Ashi trading strategy is a good option when you want to eliminate noise and false signals when trading BO. This indicator is a beginner-friendly candle that’s easy to use and supported by all major trading platforms. It works well for analysing the upward and downward trends for BO, forex, and other trading instruments.

For the best results, however, you’ll need to combine this indicator with other indicators like Bollinger bands and moving averages. The longer time required to gather Heiken Ashi data makes it suitable for long-term binary option trading strategies.