Trading system for Binary Options

Trading system for Binary Options

"I hope you can make the most of this material. Much success on this trip. "

Nowadays there is a lot of way to make money online. One of them is investing in a financial instrument called binary options. These operate in turn as an investment system where the trader, whether based on market analysis, price action, news, technical strategies or intuition buys or sells an asset for a Time of expiration determined.

The main characteristic of these products is that it is about predicting whether the price of a good will go up or down during a specific period and there are only two options, win or lose everything, hence the name binary. When buying a binary option the potential yield it offers is known before making the purchase. The profitability will depend on the% offered by the broker (Platform that serves as intermediary to make the transactions) to the asset that has been chosen to operate.

It can be said that making money in binary options is not the difficult part because, to win is simply guessing that the price will move in a certain time to a level X; If the price moves to that level in the defined time, then we win. You can buy or sell by clicking.

The number 1 problem of most people who want to be successful at this is that they focus on the results (on the money they are going to get). When this happens, greed increases, and when greed increases; The emotions are expressed in a negative way (Panic, fear, doubts), therefore discipline is lost, and if discipline is lost, we are defeated. Because everyone has free will, they want to do what their beliefs dictate. They use common sense, logic, mathematics to want to be consistent, but in the end they end up failing like 95% of the losers.

To achieve consistency in trading and be profitable, you have to change your mindset. Start this from scratch. Y

Above all things bear in mind 3 psychological rules:

• Accept the risk of your operations with confidence.


• Take responsibility for your operations.


• Errors will be present all the time.

There are 3 Realities that you must understand the market, is what M. Douglas says in his book "Negociar en el zona": They are important because they help us control ourselves and not want to control the market.

• You do not need to know what is going to happen in the market to win.


• Each moment is unique: that is, each moment and its outcome is truly a unique experience.


• Anything can happen. Trading can work well or not. In any case, learn to wait for the next opportunity to appear and go through the process again and again. With this approach you will learn in a methodical, non-arbitrary way what works and what does not.

One way to get this trader mentality is through discipline. To acquire the discipline should follow an organized axis in their business. For this reason I present a trading system in this document designed to be applied to any broker. However it is more focused on the Iqoption broker. This trading system makes a combination of simple psychological exercises, strategies to operate binary and the rules that must be followed to acquire discipline in this business.This system is optimized to be cost effective as long as it is applied exactly as described below.Application: Monday to Friday in the London and NY sessions (8am - 12PM in my country): I recommend that you use this system after 1 hour of the London login and you finish operating 1 or 2 hours before the closing of London .

 

RULES FOR OPERATING

 

1. Be CONSISTENT; Never lose: Losing is not an option.


2. Do not operate if the mood is emotionally negative (See or do something fun). Your mood emotionally affects how you interpret the information the market offers you.


3. Before you start to see the charts; Read this document and try to read the news of some calendareconomic. If there is shocking news for some currency pair, do not operate it until you pass that news.


4. Make technical analysis with supports and resistance in graphs of 1 minute. After this observe for 5 minutes you are making the price. Just watch


5. Divide the screen into 2 of Iqoption or Metatrader: a screen of graph of 1 min and another one of 5 seconds (InIqoption). If it is in MT4 open a chart of 1 min another of 5 min with expirations of 2 to 5 min, applying the same methodology.


6. Open demo account and operate at least 5 trades, to verify the predictability of the market.


7. Open real account and start trading.


8. Operate strictly with any of the strategies described below.


9. If there are two losses in a row, read this document again and again until you regain confidence.


10. If you make 3 consecutive losing trades, stop trading and go for a walk or watch a comedy until you regain confidence.


11. Have patience, perseverance and discipline. Never DESPITE.


12. WIN, WIN (Repeat this 3 times before operating, so your psychology acquires the confidence you need).

Capital management (This monetary management is the one I use, but it is optional) The important thing is to be consistent.

1. Do not risk more than 10% on an operation. From 1 to 5% is ideal. If your starting capital is 20USD, you start with 1usd which represents 5%.


2. Begin to operate depending on the initial capital: 1USD with 100USD or less, 2USD with 200USD and successively.


3. Use martingale until the 3rd operation in case of losses. If the 3rd is lost, stop operating. I apply martingale as follows: for example if I lose a 1USD operation, the next operation will be 2.5USD. But I prefer to split this operation into 2 inputs; One from 1USD and the other from 1.5USD. This is why I make multiple entries but not always; Sometimes I just make a single entry.


4. Daily goal is 15%. After reaching it can be made compound interest of 3 times. The compound interest I make is this: for example if my goal was to reach 100USD today. The last operation I did made me reach 105USD, that is reach my goal and something more. Those 5 USD others use it to make compound interest; Ie I invest 5 USD, which I win from there I reinvent it until the 3rd operation. 5) Open an Excel at the end of the session and place the data. In this Excel I place with the start of the session of the day, when it finishes, the date and the hours.

 

Application and description of strategies (Focused on Iqoption)

1. Open the broker platform

2. Configure the sail charts

3. Place the 1-minute chart

4. Draw lines of support and resistance, channels

5. Add technical indicators (Bolinguer and RSI bands).

6. Divide the screen into 2. One in 1 min graph and the other in 5 second graph.

7. Look for the odds in our favor and make the tickets expired for a minute, or less.

Descriptions of strategies

Ø In favor of trend (1 min graphics) (AFT Strategy)

1. After the price break a level (One level can also be a pause candle) in a 1 minute chart, wait a pullback to the broken level and confirm in a 5 second graph that the price touches the upper or lower bollinguer band and Produce a green candle if the trend is bullish or red if it is bearish. Sometimes you just have to play the bolinguer band. I recommend using this strategy on the weekends in OTC market.

In this image we can see that the price is coming out of a range to resume its upward trend. It breaks the last maximum that the price had created and produces a red pause candle in the form of recoil (We could have entered just after producing the red candle because it gives me the final signal the graph 5 seconds). Now I expect another confirmation in the chart of 5 sec to make an entry with the upward trend.

The final confirmation: the price penetrates the bottom band of bolinguer in graph of 5 seconds and produces a green candle. This entry was anticipated.

If the micro-trend is well defined it is much better to do operations in favor of it. As in the following image.

A tip for the entrances in 5 seconds: when bolinguer bands become very narrow it is not advisable to operate. See the example below one of my students. (Just where that operation ended, it must have been the entrance).

 

ØCounter tendency (Graphs of 30 sec or 1 min) in channels in channels in channels (Strategy CTR)

1. When the price is in range in graphics of 30 seconds or 1 min. Check that the candles touch the bollinguer bands at the ends. And confirm in the graphics for 5 seconds. The confirmation is as follows: We verified that the market is in range in graph of 30 seconds. Then we expect the price to touch one of the ends of bolinguer bands in 5sec; Upper or lower. It can be sold when the price reaches the upper bolinguer band and can be bought when the price touches the lower bolinguer band. Range operations are performed until the range is broken by a sharp price move in the 1 min chart.

In the image we can see that the price is forming a range after a bullish expansion. I notice that the price reaches the lower Bolinguer band in both charts. I see it this way: I am aware that the price is in range, I see that the lower band arrived in 30 seconds (This was my first sign). My last signal is in 5 seconds: I see

That the price touches the lower bolinguer band and I make the entrance without hesitation.

Tips to determine that the market is in range:

Observe that the price has crossed from one end to another producing at least 2 points of contact at each end.

Use the RSI: observe that it is kept linear, right in the middle, ie it does not cross any of the levels of overbought or oversold.

The bolinguer bands are placed horizontally.

A last tip is that sometimes many alternating candles are produced: one red, one green and so (This happens mainly in the graph of 1 minute).

Examples of input in range

It is appreciated in the photo that the price defines very well a range after a rise, making contact in 3 points of Each end.

In this other image, we can see the price in a range to be operated whenever it reaches one of its extremes.

• How to know if the range is finished so you do not continue to operate and change strategy?

Immediately cease to operate range when the price produces a sharp movement towards one of the ends breaking the horizontal line and producing a new maximum or a new bass. That is when the price comes out of the extreme. In this case we could change the strategy to operate in favor of market conditions.

Bolinguer bands begin to expand and cease to be horizontal. And the RSI crosses one of the overbought or oversold levels.

I will use the same example above: in this range, that would be my last operation: We see that the range is about to end because the price produced a strong moving with a bullish green candle that broke the line and upper band. Also notice bolinguer bands in 30 seconds, they are beginning to expand.

In the image below. Perform this operation because the market is still in range. At one point the price broke the range (the first arrow) and produced a new maximum, but then the price re-entered the range reaching the bottom bolinguer band. The RS also tells me that it is still in range.

The following are attached photos of some trades during my daily trading session

In favor of trend

Upward inflows: we see a bullish trend in graph of 1 minute, the price makes a backward that is confirmed clearly in the graph of 5 seconds; The price touches the lower band of bollinguer and produces a green candle. Just when the green candle appears is the entrance.

Bottom Tickets: The trend in 1 minute is bearish, in the chart of 5 seconds the price touches or crosses the upper Bolinger band and produces a red candle. Just that red candle is the entrance to the ground.

When the price is in this state in range: We verify that the market is in range because it moves from one end to another without making new highs or lows.

Upward entry: Market of 30 seconds in range, the price reaches the lower end or lower band of Bolinguer in graph of 30 seconds. Then I verify that in graph of 5 seconds the price touches or crosses the bottom bolinguer band also. And just when it crosses is the entrance.

Low entry: Market of 30 seconds in range, the price reaches the upper end or upper band of Bolinguer in graph of 30 seconds. Then I check that in graph of 5 seconds the price touches or crosses the upper band bolinguer also. And just when it crosses is the entrance.

The use of RSI: this indicator only confirms that the market is in rank or trend. I use it as follows: when the purple line is in the middle and stays there without reaching the extremes, it tells me that the market is in range and will be maintained for a while until the RSI crosses one of the extreme. When the RSI crosses one of the extremes tells me that I must change the operations and operate with the trend. I do not use it to analyze in graph of 5 seconds.

 

Trending channels also work

 

 

 

When we draw channels, the ranks strategy also works. Ranges that are formed in 30 sec or 1 min generally break in favor of the general trend of the 1hr chart. It is ideal to always operate in favor of this trend.

Tips to make this system more effective

1. Focus on the 1 minute graphics. That is making the price there. Forget the 5 second chart until you see the opportunity in the 1 minute chart. It should proceed as follows: I analyze the graph of 1 minute, stroke supports and resistance in the last minimum and maximum that made the price. After this, I will look for opportunities in probability zones in the 1 minute chart. Once the opportunity is detected, I see the graph of 5 seconds to confirm the final signal. What happens if I get the signal in the 1 minute graph and not in the 5 second graph? O What happens if the signal appears in the graph of 5 seconds and not in the one minute? The answer to this is simply not to operate, that is, to wait for another input.


2. Psychological exercises seem to be very simple, but they really are very effective. They have to apply it to acquire a trustworthy status when operating. Repeat in their mind: "I am a consistent trader" instills a positive belief that increases their self-esteem when it comes to trading.


3. Another thing: the objective of each trader should be: to achieve consistency in trading. Forget for a moment that you are going to become a millionaire, and focus on achieving resistance. (Most times I do 1usd trades because I got that mindset, I do not much care about money, but rather, be consistent). When I have that focus in my mind, the money comes as a surprise. Claro is applying monetary management in a systematic way.

 

My recommendations for optimal results of this trading system are as follows:

 

1. Study the basic concepts of price action. This should be the main indicator of any trading system. For this is the other indicators.


2. Understand when the price is in rank or trend is essential to do correct trading, applying The strategy according to the condition of the market.


3. Know the most common candles patterns, since the market usually respects certain patterns regardless of the strategy used to operate.


4. Have basic knowledge of bolinguer bands. For me after the price, this has been the best technical indicator of all time.


5. Take into account the market volatility conditions before trading. If you are very aggressive, leave it for another day. This mainly happens when there is a lot of news. Be careful on Mondays and Fridays.


6. I do not recommend operating martingale or compound interest until the entire system is mastered. Do normal operations, investing 1 to 5% per trade (Ideal 1%) to reach your goal, following the rules described at the beginning.

 

Note: Later on I will be posting videos of this strategy. I have developed this strategy with my accumulated years of experience and the advice a very professional trader who at present is a retired millionaire.