Anyway, almost any trading system takes levels into account, even if the main signal is fed by a certain technical indicator or a fundamental component.
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The indicator itself shows on the chart at which levels the largest tick volume was observed. In the preset spectra, yellow indicates the highest temperature.
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That is, the closer to the yellow color, the greater the significance of the tick volume at a specific price level. A short-term key level can be formed during one candle. In this case, the repeated level confirmation only amplifies the signal.
By default, the tick volume is taken from the minute timeframe, but you can specify any other TF. Also, the indicator has several display settings for more convenient information perception. Indicator settings In general, the indicator does not require adjustment as such, since the calculation algorithm in the root is very simple.
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However, there are several parameters that can affect the visual display of temperature. Note that this parameter is only suitable for analyzing volumes on history because when a new bar appears, the old values will be recalculated. Past indicator values are not redrawn; CandleShadow — temperature display only on candle shadows.
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Useful for analyzing the bounces off levels; CandleBody — temperature display only on candle bodies. Useful for analyzing breakdown levels; BullSpectrum — choosing thermal indicator for binary options range of bull candles; BearSpectrum — choosing the range of bear candles you can choose one range for candles of any type ; DrawSize — candle cell size in pips ; VolumeTf — the initial timeframe for calculations.
To obtain a more accurate result, it is desirable to leave the smallest TF possible minute ; SumBars — the number of candles to display on the chart. Tips for use In fact, you can determine for yourself how to interpret the signals sent by the thermal indicator for binary options. The main thing is to understand the peculiarity of the analysis of tick volumes.
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With the help of the indicator, you can determine at what levels the trade was most active. First of all, pay attention to the accumulation of volumes at specific price levels.
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The more repetitions, the stronger the level. Also, try not to think out for yourself, focusing only on the yellow shade of the candle.
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Sometimes, the price moves evenly, resulting in no accumulation of volumes at a particular level. The main advantage of the indicator is its universality and clear short-term signals.
In fact, the signals can be used both to determine new levels and to confirm the breakdown of the old ones.
Conclusion In conclusion, I would like to clarify one point: do not take the indicator values as an accurate signal to action. The indicator can become an excellent assistant in daily trading, specifically, to simplify the identification of key levels and, in particular, for scalping.
Nevertheless, the entry into the transaction must be supported by other signals.