For some mysterious reason Vortex advisor did not become popular right after its introduction in 2009. It was first developed by Etienne Botes and Douglas Siepman who published an article in “Technical Analysis of Stocks & Commodities”. After the publication, it seemed that everybody forgot about obscure tool. It could have gotten lost and forgotten if not for the binary options market.
Since then, this technical tool has gained traction as a reliable trend following indicator that can produce surprisingly accurate buy and sell signals. However, it may still take a few more years of market testing and experience to fully evaluate the vortex indicator’s potential.
It turned out that Vortex is ideal for trading in the market of electronic contracts. By and large, it can be a part of a complex strategy and it can be used as a single tool for trading. No even trading platform offers Vortex. Fortunately, you can find it on the Pocket Option broker.
The vortex indicator is commonly used in conjunction with other reversal trend patterns to help support a reversal signal. It is integrated into most technical software programs. VI+ and VI- are typically graphed independently below a candlestick chart. The chart below provides an example with lines that indicate changing trend signals on a candlestick chart.
Learn more about the Vortex oscillator
Vortex is an oscillator that is why it is displayed under your chart. The vortex indicator is based on two trendlines: VI+ and VI-, positive and negative trends respectively. If you use Pocket Option, positive one is colored green, and negative – red.
An uptrend or buy signal occurs when VI+ is below VI- and then crosses above VI- to take the top position among the trendlines. A downtrend or sell signal occurs when VI- is below VI+ and crosses above VI+ to take the top position among the trendlines. Overall, the trendline in the top position generally dictates whether the asset is in an uptrend or downtrend.
The formation of lines follows a separate formula, based on the maximum and minimum price values taken for a certain period. As for the interval, we recommend using 14, regardless of whether you are trading on shorter or longer timeframes. By the way, you do not need to change anything because 14 is default in the Pocket Option terminal.
Learn more about the signals generated by Vortex
The Vortex signals are easy to read and understand. All you need to do is to wait for the intersection of the two above-mentioned lines and open a CALL or PUT.
For CALL contract – when the green line crosses the red line from bottom to top.
For PUT contract – when the green line crosses the red line from top to bottom.
Trading with Vortex is a good option for any trader regardless of his experience, knowledge, and skills. It is important to note that the instrument provides clear signals, even on shorter timeframes such as M5, and therefore it is advisable to use it specifically during this time interval to maximize profits. It is recommended to set an expiration date of at least 3 candles, and any highly volatile asset is suitable for trading signals from other indicators. The Vortex indicator’s performance is estimated at 85%, but it is not suitable for turbo options (60 seconds) due to market noise. The key ingredient for long-term trading success is having a sound trading strategy, which can be used to trade various asset types successfully. Binary options have a significant advantage over other asset types, as they provide more profitable investment opportunities.
