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

Knowing forecast versus prior figures helps anticipate whether the actual result will move price.

Question 2

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

Accepted Answer

A shorter MA crosses above a longer MA

Answer

When the faster moving average crosses above the slower one, it signals bullish momentum for a CALL.

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

An RSI above 70 indicates overbought conditions, often preceding a price pullback.

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

A bounce off support suggests buyers are stepping in, favoring an upward CALL trade.

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

Sound money management caps the amount risked per trade, preserving capital over time.

Binary Trading Practice Test