Binary option as a major working strategy
Do you prefer a fast paced approach such as those seen in 60 Seconds options? Or a more conservative, long term approach using weekly or monthly options expiries? Are there any economic events such as an interest rate decision or corporate earnings release which will affect the performance of the trade? All of these factors must be addressed when defining the parameters of your trade, and the results here will vary from person to person.
The next element in formulating your strategy is to decide on your trading assets. Do you have a strong knowledge base for a particular asset type? If, for example, you have a firm understanding of the stock market and are able to interpret earnings statements it will make sense to focus your attention on those markets. Alternatively, if you have a strong understanding of macroeconomics , you might prefer to focus on commodities or currencies.
There are factors that have a special influence on each these asset types, so it will be important for you to be able to actively trade during those events. For commodities, this might include events like the weekly inventories report in oil , whereas in currency markets it will be important to monitor the markets when major central banks are conducting their meetings. After you have decided on your trading assets and time frames, you will need to determine your forecasts for price direction.
To do this, traders will either work from technical chart analysis, fundamental analysis a study of economic reports , or some combination of the two. If you tend to be more skilled in areas of math and and probability , you will likely be better suited for chart analysis. Most traders will use a combination of these two strategies, waiting to a major economic event to generate an overall bias for prices to move either up or down , and then use technical chart analysis in order to decide on exact price levels to establish the trade.
This can be helpful in increasing the probability for a successful trade, as it ensures your trade is supported by economic data and asset valuation. Formulating your trading strategy can seem like a daunting task. To be sure, forecasting the future prices of an asset is complicated. But you will have to practice and spend time to master it before you consider trying it out on your live account. I only zoomed in for the sake of the example. Stochastic and RSI are also visible.
The Fibopiv is not entirely visible. How to spot possible entries This is a very simple strategy, just a few indicators. What we are looking for is confirmation! I like confirmation, not anticipation. I recommend that you start with just currency pairs to begin with. Monitoring too many charts is confusing and stressful and you will miss out on trade opportunities.
Okay, let us go through all the necessary steps and look at a few pictures. Notice how the candles have been making higher highs over the 50EMA. Also the Pivot line fibopiv has become a solid support. Stochastic and RSI are oversold. Arrow was my entry for a Call, star was my expiry. A winning trade I took that day. The vertical yellow line is for showing that at the moment I was looking for an entry I saw Stochastic Oscillator and RSI hitting overbought levels.
The high is also lower than previous high, see vertical red line! As you can see the first S1 could not hold so I had to confirm whether S2 would be stronger or not. Then I changed back to 1M chart.
See next picture below. Now you can see the Support 2 clearly! Notice how bullish candles tried to break above it but failed. Arrow is my entry and the star is the expiry. The expiry time for this trade was 30 minutes because I was worried that the price would try to break above support one more time before getting pushed back down. As you can see it did go for a second attempt on breaking the S2.