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There are two main types of volatility indicators:
Oscillators calculate a value and draw it into a separate chart, usually below the price chart. The current value and its relation to past values allow for interpretations of what traders are currently thinking and for predictions about what will happen next.
Channels use the volatility to calculate a price channel and draw this channel directly into your main chart. The channel surrounds the current market price and predicts the range in which the market is likely to remain. Channels predict that market that has moved too far from an average are likely to make traders nervous, which will lead them to invest in the opposite direction and bring the market back to its average.
[ Source : Binary Options ]