Binary Trading Strategies 3

Question 1

In a news-trading strategy, what should a trader review before an economic release?

Accepted Answer

The economic calendar and forecast vs. previous values

Answer

Only the broker's logo design

Answer

The number of other traders online

Answer

The color of the trading platform

Question 2

How does the moving-average crossover strategy generate a CALL signal?

Accepted Answer

A shorter MA crosses above a longer MA

Answer

A shorter MA crosses below a longer MA

Answer

Both MAs flatten completely

Answer

Volume falls to zero

Question 3

What does an RSI reading above 70 typically suggest for a binary trade?

Accepted Answer

The asset may be overbought and due for a downward move

Answer

The asset is strongly oversold

Answer

Volatility has stopped

Answer

The expiry must be extended

Question 4

In a support and resistance strategy, where would a trader most likely place a CALL?

Accepted Answer

When price bounces off a strong support level

Answer

When price breaks far below support

Answer

At a random midpoint

Answer

Only at market close

Question 5

What is the main goal of a money-management strategy in binary trading?

Accepted Answer

To limit risk per trade to a small percentage of capital

Answer

To bet the entire account on each trade

Answer

To ignore stop limits

Answer

To maximize the number of trades regardless of risk

Question 6

The Bollinger Bands strategy signals a potential reversal when price does what?

Accepted Answer

Touches or pierces the outer band then turns back

Answer

Stays exactly on the middle band all day

Answer

Moves outside the chart entirely

Answer

Disappears from the screen

Question 7

Why is backtesting important before deploying a binary trading strategy live?

Accepted Answer

It shows how the strategy would have performed on historical data

Answer

It guarantees future profits

Answer

It removes all market risk

Answer

It increases the payout rate