currency heat card is a graphical image that records all possible deviations of the current fixed asset price from its minimum and maximum values over a specified period of time.
Visually thermal currency card looks like a multicolored table. At the heart of its construction is the principle of rapid reversal – it allows you to track how far the price of assets has moved away from minimum or maximum values.
The most common thermal currency card is used by traders on binary options, because in this case it is important to pay attention to the direction of the trend and not to the value of the asset price in points.
Let’s take a closer look at what characterizes a heat card and how to trade on it on binary options.
What is a heat currency card and what characterizes the
Currency Heat Card is not a program or additional setting, it is information that is collected in a multicolored table on one of the analytical resources. The information is updated online every five minutes.
It is the most commonly used time interval, which are located from M15 to H5, but there are also cases where the daily time frame is used. Diagonal tables
will always be empty, and in horizontal and vertical places of the table will be currency names. At the crossroads they will be currency pairs.
Red, green, and sometimes gray cells are on the map. The richer the color, the more serious (or faster) the price of the assets has changed. For example, if a cell is rich in red, it will mean that in the last time frame (time interval), the value of the resource has fallen even below the previous minimum value.
In turn, a saturated green cell color will indicate an increase in the price of assets higher than the previous maximum value.
If the colors are pale, do not pay attention to them (slight price changes).
The heart of the thermal currency card is technical and graphical analysis. This tool allows you to predict a breakthrough or correction.
How to trade on thermal currency card
As we have already said, this analytical tool is most effective for binary options trading. It is often applied to pivot points, comparing them with the saturation of squares. This makes the forecast better.
However, the heat card has its limitations to be taken into account in trading.
First, there are delays in signals. This is the case with a smaller time frame and a high level of market volatility. Of course, in this case not every minute, but every second is insanely important. Experts recommend in this case you should work at wider intervals (from M15) or use additional tools to check.
It is also worth considering the various price noises and frequent cases of re-pricing of assets.
If the currency heat card is the main binary options tool, in case of Forex discomfort will cause spread. If you’re trading forex, take a closer look at other market analysis tools.
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