So, in this initial case the strategy would have been successful, with the rate remaining in-the-money after two-and-a-half hours...
Binary options - any pros at all?
- Thread starter blackkey
- Start date
I don't recall exactly what happened, but somehow, someway, I came to feel the need to throw the three-hour temporal support and resistance levels into the mix, and based on this measure, along with the extreme lower level of the 70-minute price range envelope and a reversal in the 16-minute baseline, I purchased a call contract with about a 1:7 reward-to-risk ratio. (I probably should have purchased the contract with a reward-to-risk ratio of 1:4, but since I'm testing new protocols here, I thought it best to be extra cautious.)
(Oh, and I almost forgot... at the time I entered this position, the 3½- and 8-hour baselines were both bullish, though during the life of the contract, the 8-hour measure turned bearish.)
(Oh, and I almost forgot... at the time I entered this position, the 3½- and 8-hour baselines were both bullish, though during the life of the contract, the 8-hour measure turned bearish.)
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Final Report on Trading Forex Binary Options
Copyright © 2022 by Fred Duckworth
The advantage of trading binary options over more traditional financial instruments, including foreign currency pairs, is that an asset need move only a fraction of a trade unit in one's favor to earn an amount of the trader's choosing—from a single dollar to several thousand dollars—using services such as Deriv or PocketOption. Nowhere else is this kind of flexibility and ease of realizing significant gains offered.
However, the major downside to binary options is the time factor. An individual can rightly discern the overall direction of the market, yet still lose money simply because price failed to move over the duration of the contract, or because it just so happened to adopt a temporary course in the opposite direction during the life of the option.
Nonetheless, this shortcoming can be overcome via systems such as Numerical Price Prediction (NPP), where time is an integral part of the underlying forecast model.
NPP uses baselines—moving averages calculated with respect to time rather than periods—to ascertain price direction, with the shortest actionable baseline conveying the flow of rates every 2.29 minutes (approximately). However, this measure is too susceptible or sensitive to temporary, less significant price fluctuations, and must therefore be confirmed or validated by the 8½-minute baseline.
These two measures are the first two of three primary factors dictating entry and exit levels. The third involves a second major aspect of NPP conceptualized as "temporal support and resistance levels."
Other factors are also involved, such as regression toward the mean, a basic idea in statistics referring to the simple fact that if one sample of a random variable is extreme, the next sampling of the same random variable is likely to be closer to its mean. In financial terms, it is called mean reversion, and is the assumption that an asset's price will tend to converge to the mean over time. Mean reversion is a means of timing involving the identification of both price range and average price using quantitative methods.
But, in addition to incorporating this notion that exchange rates will separate themselves only so far from the central tendencies of key price distributions, optimizing success when trading binary options is greatly facilitated by also considering temporal support and resistance levels, which is to say, the contention held by NPP that, generally speaking, there is a limit not only to the amount of distance, but also to the amount of time exchange rates will advance in one particular direction or another without deviation.
Accordingly, the third primary factor dictating binary option entry and exit levels is the 15-minute temporal support/resistance level, with long positions entered as the 2⅓- and 8 ½ minute moving averages are bouncing off the 15-minute temporal support level to rejoin the direction of the 16-minute baseline, and short positions entered as the 2⅓- and 8 ½ minute moving averages are bouncing off the 15-minute temporal resistance level to rejoin the same measure.
More generally (in addition to the 16-minute baseline) longer-term underlying/foundational intraday trends are conveyed by the 34-minute, 70-minute, 3½-hour and 8-hour baselines, with major temporal support/resistance levels observed at the 30-, 60- and 180-minute measures. Here, positions are typically entered when the 70-minute trend reverses direction to resume the same trajectory as the eight-hour (and 3½-hour) baseline(s).
Having established these parameters, I'm curious to see how closely the cryptocurrencies, commodities, stocks and indices offered by PocketOption obey these same principles, if at all.
Copyright © 2022 by Fred Duckworth
The advantage of trading binary options over more traditional financial instruments, including foreign currency pairs, is that an asset need move only a fraction of a trade unit in one's favor to earn an amount of the trader's choosing—from a single dollar to several thousand dollars—using services such as Deriv or PocketOption. Nowhere else is this kind of flexibility and ease of realizing significant gains offered.
However, the major downside to binary options is the time factor. An individual can rightly discern the overall direction of the market, yet still lose money simply because price failed to move over the duration of the contract, or because it just so happened to adopt a temporary course in the opposite direction during the life of the option.
Nonetheless, this shortcoming can be overcome via systems such as Numerical Price Prediction (NPP), where time is an integral part of the underlying forecast model.
NPP uses baselines—moving averages calculated with respect to time rather than periods—to ascertain price direction, with the shortest actionable baseline conveying the flow of rates every 2.29 minutes (approximately). However, this measure is too susceptible or sensitive to temporary, less significant price fluctuations, and must therefore be confirmed or validated by the 8½-minute baseline.
These two measures are the first two of three primary factors dictating entry and exit levels. The third involves a second major aspect of NPP conceptualized as "temporal support and resistance levels."
Other factors are also involved, such as regression toward the mean, a basic idea in statistics referring to the simple fact that if one sample of a random variable is extreme, the next sampling of the same random variable is likely to be closer to its mean. In financial terms, it is called mean reversion, and is the assumption that an asset's price will tend to converge to the mean over time. Mean reversion is a means of timing involving the identification of both price range and average price using quantitative methods.
But, in addition to incorporating this notion that exchange rates will separate themselves only so far from the central tendencies of key price distributions, optimizing success when trading binary options is greatly facilitated by also considering temporal support and resistance levels, which is to say, the contention held by NPP that, generally speaking, there is a limit not only to the amount of distance, but also to the amount of time exchange rates will advance in one particular direction or another without deviation.
Accordingly, the third primary factor dictating binary option entry and exit levels is the 15-minute temporal support/resistance level, with long positions entered as the 2⅓- and 8 ½ minute moving averages are bouncing off the 15-minute temporal support level to rejoin the direction of the 16-minute baseline, and short positions entered as the 2⅓- and 8 ½ minute moving averages are bouncing off the 15-minute temporal resistance level to rejoin the same measure.
More generally (in addition to the 16-minute baseline) longer-term underlying/foundational intraday trends are conveyed by the 34-minute, 70-minute, 3½-hour and 8-hour baselines, with major temporal support/resistance levels observed at the 30-, 60- and 180-minute measures. Here, positions are typically entered when the 70-minute trend reverses direction to resume the same trajectory as the eight-hour (and 3½-hour) baseline(s).
Having established these parameters, I'm curious to see how closely the cryptocurrencies, commodities, stocks and indices offered by PocketOption obey these same principles, if at all.
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I'm doing what I was doing before anyway, but now it's been optimized, as described in Post #193. So here too, if it works often enough between now and January 19, 2022 that I develop full faith and confidence in the protocol, I will increase the stakes by several multiples. But for now, I'm starting at one dollar...
You are gambling, not trading.
Supposedly binary options are also available through the Chicago Board Options Exchange (CBOE) so that traders with an options-approved brokerage account can trade CBOE binary options through their traditional trading account. As far as I know, this and Nadex are the only two possibilities.