Learn About Rainbow Trading at IQ Option

Learn About Rainbow Trading at IQ Option

Ready to join our tribe?

We respect your email privacy

Subscribe now to recieve exclusive updates and offers!

Rainbow Trading might sound like a peculiar name for a trading technique, but don’t let that put you off as there are many perks for those who adopt it. If you want to learn more about it, then IQ Option has the perfect guide for you.

Rainbow Trading basically combines 10 indicators in one, with the option to add more if you so wish. This means that when you are implementing it on a trading chart a selection of colours will be visible – much like a rainbow, hence the name.

While having an aesthetically pleasing graph is one benefit, there are numerous other benefits by which using 10 indicators may benefit you. Namely, that these moving averages combined tell their own unique story about a specific asset’s behaviour.

Therefore, the second perk of Rainbow Trading is a unique, all-encompassing perspective into the market which can see you stand to gain more profit when trading CFDs. Thanks to IQ Option, the benefits of this trading are clearly outlined to you in an easy to comprehend fashion which thus means that you can get started with this fantastic method asap.

How Rainbow Works

According to IQ Option, in a nutshell, “Rainbow MA is a combination of moving averages of different length that are all plotted on the same price chart”. The intersection in this chart can indicate price reversal. With this, knowledge you can more accurately estimate the trend’s strength.

The more colours in your Rainbow per se, the longer a complete reversal will take to be shown. Of course, good things come to those who wait. However, you should be wary of expanding those lines above the recommended 10 indicators all the same, as you don’t want to be sitting on those potential market trades too long.  IQ Option outlines three main way by which you can implement the strategy.

These are that you can either combine it with other technical analysis tools as a trend-following indicator, use it on its own, or you can use it to enter a position in the direction of the general trend and against the retracement. The latter of these though can be used only on strong trends as a means to look for a short-lived retracement. You will also need to tell a trend from a retracement.  All three of these techniques are explored by IQ Option in-depth and you should head over to their platform

Getting Started

The option is already available at IQ Option and the guide also includes a section where they help you get started using Rainbow Trading on their trading platform. A quick run-down of how this works is that first, you will need to click on the  “Indicators’ button in the bottom-left corner of the screen and then on the ‘Moving Averages’ tab.

This will allow you to choose the number of periods which will, in turn, affect the sensitivity of the indicator. It is worth bearing in mind that a lower number will decrease the number of false alarms when using the technique. You should all allocate your moving averages, and finding the right balance is key in this respect. On average, most traders use 6 to 8.

Finally, you can choose the price type and the moving average type that is visible. The default parameters for these are Close price and SMA which are also the most commonly used. However, you can choose to set them however you like.

If you want to learn more or to get involved then go to IQ Option now who have the full toolkit you need.

Recently Similar News

Latest Guides

Latest News

Blockchain,Changelly,Cryptocurrency,Exchange Platforms

Changelly Adds Ardor, Ignis, and NXT to Changelly PRO

Changelly, the online cryptocurrency exchanges, has added three more tradable assets to their Changelly PRO platform. Changelly, the large online crypto exchange, has recently added an additional three cryptocurrencies to their Changelly PRO platform, Ardor, Ignis, and NXT. All three tokens developed by Jelurida will be tradable against BTC as ARDR/BTC, IGNIS/BTC, and NXT/BTC. Jelurida […]

6 November, 2020
Crypto Wallets,Exchange Platforms,Kraken,Ledger

Ledger Phishing Scam is Targeting Crypto Wallet Users

Ledger, the cryptocurrency wallet company, has been massively affected by a data breach and phishing scam. Ledger, the world renowned cryptocurrency hardware wallet producer, is facing a lot of problems with a data breach that is being used to target their customers. Kraken Intelligence, the intelligence arm of the Kraken cryptocurrency exchange, analyzes this data […]

5 November, 2020
Bitcoin,Blockchain,Cryptocurrency,Ethereum

Ethereum on Track to be First Blockchain To Process $1 Trillion In Yearly Transactions

Ethereum, the second largest cryptocurrency by market cap, is preparing to break the $1 trillion mark in yearly processing. Ethererum, the largest cryptocurrency behind Bitcoin, is on track to be the first blockchain to process over $1 trillion in transactions in a single year. Currently, the Ethereum network is processing more than double the amount […]

4 November, 2020
Binance,Blockchain,Cryptocurrency,Exchange Platforms

Binance is Giving Away $20,000 in Fifth Learn and Earn Series

Binance, the largest online cryptocurrency exchange, is hosting its fifth learn and earn series, this time with Orion Protocol. Binance, the worlds largest cryptocurrency exchange, will be hosting their 5th Learn and Earn campaign in collaboration with the Orion Protocol. In this campaign, Binance will be giving away $20,000 worth of ORN, the native cryptocurrency […]

3 November, 2020
Bitcoin,Blockchain,Cryptocurrency,Exchange Platforms

Bitcoin Monthly Prices Finishes at Second All-Time High

At the end of October, Bitcoin has registered its second highest closing price of all time. Bitcoin bulls continue to rejoice as Bitcoin closes at its second highest monthly price in the history of the digital currency. Bitcoin closed October with a price hovering right around $13,800, the second highest monthly price finish besides the […]

2 November, 2020
Cryptocurrency,Exchange Platforms

Cryptimi Announces Launch of Additional Platform for German Speaking Users

 At Cryptimi, we have announced the launch of our newest news platform in one of the largest languages globally, German. We are very pleased to announce the release of our world class Cryptimi platform in German! Now, all german speakers will be able to access all of the traditional media and features they would receive […]

27 October, 2020
Binance,Blockchain,CoinMarketCap,Cryptocurrency

CoinMarketCap Launches Latest Earn Campaign With Helium

CoinMarketCap, the largest online market cap aggregator, has launched their latest Learn and Earn campaign with Helium. CoinMarketCap has launched their latest iteration of their Learn and Earn program in partnership with Helium. Learn and Earn is a program launched by CoinMarketCap that allows cryptocurrency users to learn about new cryptocurrencies and earn some of […]

25 October, 2020
Binance,Bitcoin,Cryptocurrency,Exchange Platforms

You Can Now Spend BNB and BUSD With All Shopify Merchants

Shopify, the all-in-one online commerce website, now allows all of its merchants to accept Binance’s tokens BNB and BUSD via Alchemy Pay. Alchemy Pay, a worldwide cryptocurrency payment solution provider has worked with Binance and Shopify to integrate BNB and BUSD for payments to all Shopify merchants. Shopify is the worlds largest e-commerce platform with […]

23 October, 2020