Which indicator or system do you think is best for trading binary option?
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Thread: Which indicator or system do you think is best for trading binary option?

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    Which indicator or system do you think is best for trading binary option?

    In the truth of the whole matter, binary option trading is more profit massing than the classic forex trading, but the risk involved in trading it is higher too. This is why I believe that a better indicator or trading system with this is the best for all traders doing it. And in binary option, the indicator or system will not work alone for the direction, but for the timing as well.

    In my own view, the binary option should be traded with the indicator or system that works with pivotal lines, I means the support and resistance lines. This line should be the creative point of locating what will be next for the trader (a means of awareness). And the list of indicators and system I have set aside to do this are many, among which are Fibonacci trading system, trend-line diagram, Bollinger bank trading, pivot doing system, moving average etc.

    But, I noticed that it is better to use indicator(either trend trading or reversal ones) with a trading system of breakout together (I mean using Fibonacci with moving average as an example). By this, I think there is a validation and a confirming trading techniques that will buttress the view of the trader over that prevailing direction at that period of time. I have also noticed that Bollinger band is a power binary option trading indicator that can standalone.

    Please, let us all review this and bring about the suggested ways you think you can trade on the robooption trading platform successfully. HAPPY TRADING!

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    You are absolutely right noticing that we have to estimate market timing properly trading options. I don't think that there are any indicators for that purpose, however there are some price action techniques that can help you out.

    For example, there is a chart pattern called "congestion". Normally, it's a local trading range and it starts with big elongated candlestick that is called "Measuring candlestick" (or measuring bar). If you have 4 consecutive candlesticks located right within that measuring candlestick, odds are high that congestion will prolong for at least 10 bars.

    congestion.png

    It means that you can filter attempts of price to get our of the range before congestion is completed (before you have 10 internal bars/candlesticks within measuring bar).

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    Quote Originally Posted by Value trader View Post
    You are absolutely right noticing that we have to estimate market timing properly trading options. I don't think that there are any indicators for that purpose, however there are some price action techniques that can help you out.

    For example, there is a chart pattern called "congestion". Normally, it's a local trading range and it starts with big elongated candlestick that is called "Measuring candlestick" (or measuring bar). If you have 4 consecutive candlesticks located right within that measuring candlestick, odds are high that congestion will prolong for at least 10 bars.



    It means that you can filter attempts of price to get our of the range before congestion is completed (before you have 10 internal bars/candlesticks within measuring bar).
    You have said this well, price action is even what I have forgot to mentioned, and it is one of the ways that fits the binary option trading. Looking at this explanation you have suggested sir, what is the best time frame you will suggest for the use of this system of price action on binary option trading. Because the chart pattern can not be this way all the time, if it is so, traders will wait more time for it to align again. I could suggest lower time frame between 15-1hours chart for this, what do you think?

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    Last edited by Gulfstream; 01-27-2016 at 08:10 AM. Reason: del pictures

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    I have been amazed for a long time that the vast majority of traders almost never wonder what kind of trading system they have, in the long term period. They prefer to not waste time on research, and they immediately get into the market, hoping for their own good fortune. What could be more stupid? Although I did the same in the beginning. On the other hand, this kind of behavior is not always a laziness. The trouble of many traders is that they have no probabilistic thinking, plus, unfortunately, there is no reliable methodology. Having checked first, second, third, the trader often does not see the problem, or see it already after the few ruined deposits.

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    we can say that using the highest leverage will be so bad if you are trading with a high capital so i think the best leverage is 1:100 and i had many margin call but in fact it may be a disaster for any trader but if you are a beginner trader it may be a great opportunity for you to learn from your mistakes

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    So far I can not find any good reliable way in my work in the forex market. So I prefer to work in the forex market so that there is no one method that can make a profit in the forex market. So I have been trying since the beginning of my work in the forex market can find a way by which to make a profit in the forex market a small loss

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    What a very good thread, i really do not know the best indicator, but i believe that this thread will add value to my earning in the binary option trading. One thing that is important now is how to gather the ideas of traders here together. But with the look of thing that i have sen with many binary option trader, i think bollinger band is the best tool here.

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    hoping for their own good fortune. What could be more stupid? Although I did the same in the beginning. On the other hand, this kind of behavior is not always a laziness. The trouble of many traders is that they have no probabilistic thinking, plus, unfortunately, there is no reliable methodology. Having checked first, second, third, the trader often does not see the problem, or see it already after the few ruined deposits

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    we are able to state which while using greatest influence is going to be therefore poor if you're buying and selling having a higher funds and so i believe the very best influence is actually 1: 100 as well as i'd numerous border phone however in truth it might be a tragedy for just about any investor however if you're the newbie investor it might be an excellent chance that you should study from your own errors

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    Ideas for trading with binary options
    How to create profitable trading method for binary options?

    First of all, we have to know parameters of our strategy – they should correspond to opportunities that binary option can give.

    Profilt/loss ratio

    As you understand – we have to have higher quantity of profitable trades to at least cover our costs. So, we should have strategy that would generate large quantity of winning outcomes – it should not be necessarily big moves, just small deviations in our favor.

    Trading hypothesis:

    To formulate rules for robust trading strategy, we have to formulate trading idea that would benefit from certain market conditions observed on a daily basis. Also, this idea has to be pretty simple to execute.

    If we look at distribution of daily price action on, say, popular currency pair EURUSD, we would notice that rotation of the price occurs when price returns to average sessional price, that can be easily found with EMA indicator. For example, on 5-minute chart of EURUSD, decision making points look like shown below:

    Attachment 11609

    I have to mention that day was pretty volatile – in many cases there would be much more decision making points, especially if price would trade within consolidation area.

    For sixty-second options, it’s possible to build simple scalping strategy that would be impossible to execute in conventional forex trading. If price touches 21-period EMA, we might observe at least slight pullback within next 2-3 minutes (price holds above EMA). Therefore, our trigger for entering long trade (buying «call» option) is a moment when price touches 21-period EMA from above (we can buy «put» option when price touches it from below).

    Attachment 11610

    We are talking about small pullback that does not exceed 5-10 pips, it can be 3-4 pips in most cases. So, it is considered as a «noise» for many intraday traders. In fact, if you target is 5 pips per trade, it would be tough to trade – first you have to cover your spread, then capture 2-3 pips and go away- even 1/1 profit/loss ratio can not be easily achieved in such type of trading. It does not make sense in traditional trading.

    But for binary options, it can bring some profit. You have to have at least 1 pip above strike price to realize profitable scenario – you get guaranteed 70% per bet. As you understand, it can not be achieved in traditional trading.

    But of course, we should not only find profitable pattern, but rather know – what market conditions are risky for our strategy? In other words, we have to know when price moves through moving average without any pullbacks.

    For example, it occurs after important news announcements. Below is a chart of GBPUSD after news announcement:

    Attachment 11611

    Therefore, you have to know periods within a day when you are not trading.

    Also, after elongated consolidation areas market can become extremely volatile – you have to take such periods to consideration as well. The more elongated such period was, the more volatile price action will be – also it means risk for such type of scalping strategy:

    Sometimes, period of reduced volatility pre-defines good trending move, we can use pullbacks to open positions in the direction of the trend.
    This example shows that you can build a trading strategy on short-term options (120 seconds). Also, you can use higher timeframes for your strategies using long term options with other expiration dates.wer34

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