There are lots of different kinds of indicators in the financial industry. The harmonic indicator is the only indicator which is totally different and advanced than most another indicator in binary options trading. The indicator is mostly based on Fibonacci retracement ratio and it has excellent PRZ identifying capability. Due to the extreme popularity of the harmonic pattern, the coder has come up with the unique solution of harmonic indicator which automatically draws a harmonic pattern in the chart. Professional options traders use the harmonic indicator to execute put and call option in the financial instrument.
Let us see how the professional use the harmonic indicator in their binary option trading
Thanks to the advance coder to design such delicate trading tools for us. The most high-end harmonic indicators that the options trader uses nowadays are absolutely free. The trading harmonic pattern can be extremely difficult without the proper knowledge of Elliot wave and support and resistance level. Even though the indicator is capable of drawing the harmonic pattern, extensive knowledge about other parameters is also required. Price action confirmation at the point D of harmonic pattern completion is required to execute the trade. Almost every single indicators can be modified and the harmonic indicator is no exception it .A trader can easily manipulate the coding and parameter for a better result. While doing so extensive precautionary measure should be taken before tweaking the indicator since new data can cause faulty pattern recognition.
In the above figure, the bullish Gartley pattern has been successfully identified by the harmonic indicator. Once the pattern is identified professional options traders look for potential support and resistance level depending on the formation of the pattern. Here the bullish gargle pattern is completed near the point D which is strong support level for the EURJPY pairs. Once the pattern is completed, trained option traders then wait for the price action confirmation signal.IN the above figure the call option was executed with the formation of the bullish morning star pattern right near the key support level. Harmonic pattern trading is extremely profitable and reliable but this should be executed in the live market after extensive practice in the demo environment.
Professional trader who use harmonic trader often draws the pattern again all by themselves so that they can alter some preset value of the indicator for a better result. If anyone alters the data of this harmonic indicator frequent back testing is required in order to confirm proper functionality of the indicator.