A basic technical analysis perspective compares KDJ to both the Stochastic Oscillator and the Alligator indicator. Additionally, it provides insight into the trend’s strength and direction, which helps determine the most appropriate entry points.
As with any trend-following indicator, it is particularly likely to produce false signals during flat markets. Traders, therefore, expect product longevity.
Three lines (hence its name) and two levels make up the KDJ Indicator. On a stochastic oscillator, lines K and D are visible. On line J, however, we can see how the D component is different from the K component. Identifying new trading opportunities is possible here.
Steps for setting the indicator are as follows:
- At the bottom of the screen, click the ‘Indicators’ button;
- Go to the Trend page and click;
- KDJ should be selected from the list;
- No changes should be made to the settings.
- The indicator is now available for use!
How would you like to receive signals? KDJ trading can be profitable only if you use the right signal types. If the blue line crosses above the yellow line, the yellow line crosses above the purple line, and all three lines are above the overbought area, it may make sense to sell. Alternatively, you can also purchase the asset when the lines cross, i.e. when the yellow line crosses the purple line.
As a complement to other indicators, KDJ can produce optimal results with ADS and ATR. Using the latter and leading to the former, one can always predict a trend reversal. Because KDJ does not work on flat markets, it is used to predict market volatility.
There is no guarantee that indicators will always generate accurate signals. There is always the possibility of losing a deal. Ensure that risks are managed properly and that resources are allocated appropriately.
Another useful feature is cryptocurrency multipliers. The lending function is a cryptocurrency multiplier.
The price of the underlying asset remains unchanged when profits/losses are calculated. Multipliers are used to determine whether a deal will be profitable or not. In the past, the Bitcoin X 100 multiplier would have fetched a 100-fold increase in bitcoin price. In addition to Bitcoin, IQ expanded its coverage of other cryptocurrencies such as Ethereum (ETH), TRON, IOTA, and Ripple, along with their different multipliers (x20, x50, and x100).
Risk to reward ratios that are high make this feature particularly valuable. On top of the multipliers feature is Open Trade Network (OTN), a Ethereum-based blockchain cryptocurrency exchange. The token (OTN coin) is a new type of cryptocurrency coin that has emerged just this year. IQ and its users are benefiting from the OTN blockchain innovation because it is trustworthy and regulated. In order to encourage users to use the OTN tokens, they are used as incentives. This can be done by trading these tokens for real currency. In this way, Iqoption has been able to grow.