The Ravi FX binary options strategy uses a proprietary indicator based on standard technical indicators like WMA and ATR, with their values subsequently normalized using the Fisher transform. This approach allows traders not only to receive accurate signals for opening trades but also to determine when it's best to refrain from trading.
Read our review to learn how to properly use this unique indicator and which filter best increases your winning percentage in binary options trading.
Content:
- Characteristics
- Installation
- Overview and settings
- Ravi FX Trading Rules
- Specifics of application
- Conclusion
Ravi FX Binary Options Strategy Features
- Terminal: TradingView
- Timeframe: M15
- Expiration: 3 candles
- Option Types: Call/Put
- Built-in indicators: Ravi FX [loxx], Andean Oscillator [alexgrover]
- Trading instruments: currency pairs , commodities, cryptocurrencies , stocks
- Trading hours: 8:00 - 20:00 (GMT+2)
- Recommended brokers: Quotex , Pocket Option , Deriv , Binarium
Setting Up a Ravi FX Binary Options Strategy
Indicators are installed on the TradingView platform through the Indicators menu. Click the "Indicators" button to open the "Indicators, Metrics, and Strategies" panel. Enter the name Ravi FX in the search bar, find it in the list, and click on it, making sure the indicator is authored by 'loxx'."
Then, install the second component of the trading system, the Andean Oscillator from developer alexgrover , in the same manner. After adding both indicators to the M15 chart, it will look like this.
As you can see, both indicators in the Ravi FX trading system are oscillators, so they are conveniently located below the price chart. Let's explore the principles they are based on, the optimal settings, and the trading signals they generate.
Ravi FX Binary Options Strategy Review and Settings
The Ravi FX binary options strategy is based on two built-in indicators from the TradingView analytical platform . Despite being free, both indicators are highly effective and provide trading signal statistics comparable to many commercial products.
Now for the most important part: what the acronym RAVI stands for, and what principles is this strategy based on? RAVI stands for Range Action Verification Index, a metric that reflects the percentage difference between current and past prices. Binary options traders use it to predict future market movements. The calculations use weighted moving averages of varying lengths and the ATR volatility indicator.
Information about the Ravi FX oscillator first appeared in the book "Beyond Technical Analysis: How to Develop and Implement a Winning Trading System" by renowned trader and author Tushar Chande. Forex and binary options traders are familiar with his popular Aroon and Chande Momentum Oscillator (CMO) indicators. Traders speak highly of them and actively use them in their strategies.
One of the applications of the Ravi FX oscillator is to determine whether the market is trending or flat . To do this, binary options traders add two horizontal lines to the indicator's histogram, marking key levels in the negative and positive areas: -0.07 and 0.07.
After this, determining whether the market is trending becomes very simple. If the Ravi FX histogram extends beyond this range, the asset's price is clearly moving under the influence of major players, and a trend is emerging. If the histogram bars are small and do not extend beyond this range, the asset's price is moving erratically, and the market is flat .
The direction of the price trend is determined by the color of the histogram bars. If the green bars are above the 0.07 level, the market is bullish. Conversely, if the red bars are below the -0.07 level, the market is bearish.
To improve efficiency, the developer of the Ravi FX strategy added a unique trading signal filter – the Andean oscillator. It filters out most false signals for opening positions.
The rules for using this oscillator are quite simple: when the green Andean line crosses the orange line from bottom to top, this signals an upward momentum and indicates the possibility of buying a Call option.
If the red line of the Andean oscillator crosses the orange line from bottom to top (unlike the Stochastic oscillator), this indicates sellers dominating the market and a likely price decline.
It is recommended to leave the default settings for both trading system indicators.
Ravi FX Trading Rules
Now it's time to figure out how to apply the innovative Ravi FX binary options strategy in practice. But, as you've probably already guessed, the main principle behind this system is trend following. To gain a thorough understanding of this topic, we recommend reading a special selection of articles on the subject:
- How does a trend work in the markets?
- Identifying and using bullish and bearish trends.
- Market phase changes .
- How to identify a flat market?
Only after mastering the principles of determining market phases, begin trading this system on a demo account , following the rules described below.
Opening a Call Option
- We are convinced that the trend is upward – the green Ravi FX histogram has exceeded the 0.07 level.
- The green line of the Andean auxiliary oscillator crossed the orange line from bottom to top.
- At the opening of the next candle we buy Call.
Opening a Put Option
- We are convinced that the trend is downward – the red Ravi FX histogram has dropped below the -0.07 level.
- The red line of the Andean auxiliary oscillator crossed the orange line from bottom to top.
- At the opening of the next candle we buy Put.
It is recommended to select an expiration time of 3 candles. Choose the holding period based on the financial instrument and historical data testing results.
Specifics of Using the Ravi FX Binary Options Strategy
In our experience, this strategy is most effective at the beginning of the European and American trading sessions, as well as after the release of important macroeconomic news and reports. To profit from this method, market volatility, which is observed during active market hours, is essential. To understand the financial market schedule, we recommend reading the article " The Best Time to Trade Binary Options."
Advantages of the Ravi FX Strategy
The Ravi FX strategy features simple and clear trading signals , accessible even to novice traders. The system's effectiveness is due to its unique indicators, which use the Fisher transform to normalize price values.
This strategy is ideal for traders who prefer trading systems based on the MACD oscillator. Ravi FX operates on a similar principle, reflecting price movements in a given direction.
Cons of the Ravi FX Strategy
The system's drawbacks include typical features of trend-following strategies: the occurrence of false signals in weak markets and during flat markets. Therefore, Ravi FX is recommended for use on active currency pairs and cryptocurrencies.
Another disadvantage is the small number of signals on higher timeframes, while false trading signals are more common on lower timeframes.
Conclusion
The Ravi FX binary options strategy can offer reliable entry points, regardless of your preferred market: forex or binary options. The robust filtering principle incorporated into the Anden oscillator, combined with the redesigned MACD, provides not only clear trading signals for buying binary options, but also insight into the current market phase.
With the Ravi FX indicator's levels, you can determine the market's current state at a glance. Is it poised to resume its ascent to new highs, plunge into the abyss, or likely to continue to oscillate, held captive by key price levels?
Before using real money, we recommend practicing on a demo account with a reliable broker. Trade according to risk and capital management guidelines. We wish everyone a favorable trading experience!
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