Binary options - any pros at all?
- Thread starter blackkey
- Start date
At this point, I'm looking to raise the stakes from a dollar to somewhere between $10 to $50, but only make one or two trades per day rather than ten to twenty...
When it comes to buying and selling financial instruments, there is a general rule of thumb which says that one should always trade with the trend. Nonetheless, when it comes to the practical application of this rule, it turns out that this guideline is not necessarily all that useful. For example, a given asset might be up for the month, but down for the year. In other words, it can be argued that there is more than just one trend, or even that there are many trends. So, if someone states that "the trend is your friend," exactly which trend are they talking about?
To address this issue, instead of using the standard 10-, 20-, 50-, 100- and 200-period moving averages employed by many standard trading systems, Numerical Price Prediction (NPP) assigns temporal values to specific baselines as a means of determining whether price is rising or falling with respect to any given time frame. This also goes a long way toward eliminating the challenge presented by binary options in the form of their time element.
With nothing more to explore with respect to trading Forex binary options, this morning I decided to turn my attention to other financial instruments, and looking into metals, indices and equities has convinced me that the core NPP measures remain the same across the board, with the only aspect needing adjustment from one asset class to another being the relative price ranges.
Since my HugosWay MT4 demo account offers about 72 different stocks, I decided to cross reference them with the 19 offered by PocketOption and found that all 19 were present. (I use MT4 chart configurations and custom-designed indicators for trading.) That will be pretty cool if I find out after January 19th that PocketOption operates more-or-less reputably, given that the partner I am working with overseas will essentially be able to day trade stocks without the obstacle of FNRA's Pattern Day Trading Rule, and trade Amazon at $3,241 just as easily as Twitter at $38.
To address this issue, instead of using the standard 10-, 20-, 50-, 100- and 200-period moving averages employed by many standard trading systems, Numerical Price Prediction (NPP) assigns temporal values to specific baselines as a means of determining whether price is rising or falling with respect to any given time frame. This also goes a long way toward eliminating the challenge presented by binary options in the form of their time element.
With nothing more to explore with respect to trading Forex binary options, this morning I decided to turn my attention to other financial instruments, and looking into metals, indices and equities has convinced me that the core NPP measures remain the same across the board, with the only aspect needing adjustment from one asset class to another being the relative price ranges.
Since my HugosWay MT4 demo account offers about 72 different stocks, I decided to cross reference them with the 19 offered by PocketOption and found that all 19 were present. (I use MT4 chart configurations and custom-designed indicators for trading.) That will be pretty cool if I find out after January 19th that PocketOption operates more-or-less reputably, given that the partner I am working with overseas will essentially be able to day trade stocks without the obstacle of FNRA's Pattern Day Trading Rule, and trade Amazon at $3,241 just as easily as Twitter at $38.
Friday / February 18, 2022 / 8:45 AM PST
If everything continues to unfold as it has been, I am likely to eventually ceased trading via by traditional Forex brokerage accounts and execute my transactions exclusively through the Nadex platform, despite its numerous drawbacks, due to the fact that I can make a lot more money much more quickly through the derivatives exchange. (This will eliminate the need to move to a foreign county to trade through Deriv or PocketOption.)
Described in terms of the four-part framework adopted by Alex and Nicky Ong of Forex Masterclass, I plan to use a methodology where I first determine price direction via temporal baselines. I will then use typical price ranges to value each asset. As for my entry rules, I will again use typical price ranges and designated baselines to identify and confirm support and/or resistance levels. But in terms of the fourth component, which is managing one's portfolio through multiple positions, it doesn't really apply to my approach due to the clarity Numerical Price Prediction offers with respect to interpreting price action. There is no guesswork associated with when to enter or exit positions, so it would make no sense to enter more than one position at a time regarding any given currency pair.
Starting with an initial demo account balance of $10,000, I have been generating an average return of approximately $100 per day. (It is possible to do this with a balance as small as $1,000, but this would require breaking the 1% Rule for money/risk management.)
The key to daily profitability, irregardless of Nadex's insane risk-to-reward structure for in-the-money binary option contracts, is to employ a strategy based on mean reversion/regression toward the mean using a decision-making process for selecting entries that, by the grace of God, comes as close as possible to identifying the optimum position and movement in time to purchase each individual contract.
If everything continues to unfold as it has been, I am likely to eventually ceased trading via by traditional Forex brokerage accounts and execute my transactions exclusively through the Nadex platform, despite its numerous drawbacks, due to the fact that I can make a lot more money much more quickly through the derivatives exchange. (This will eliminate the need to move to a foreign county to trade through Deriv or PocketOption.)
Described in terms of the four-part framework adopted by Alex and Nicky Ong of Forex Masterclass, I plan to use a methodology where I first determine price direction via temporal baselines. I will then use typical price ranges to value each asset. As for my entry rules, I will again use typical price ranges and designated baselines to identify and confirm support and/or resistance levels. But in terms of the fourth component, which is managing one's portfolio through multiple positions, it doesn't really apply to my approach due to the clarity Numerical Price Prediction offers with respect to interpreting price action. There is no guesswork associated with when to enter or exit positions, so it would make no sense to enter more than one position at a time regarding any given currency pair.
Starting with an initial demo account balance of $10,000, I have been generating an average return of approximately $100 per day. (It is possible to do this with a balance as small as $1,000, but this would require breaking the 1% Rule for money/risk management.)
The key to daily profitability, irregardless of Nadex's insane risk-to-reward structure for in-the-money binary option contracts, is to employ a strategy based on mean reversion/regression toward the mean using a decision-making process for selecting entries that, by the grace of God, comes as close as possible to identifying the optimum position and movement in time to purchase each individual contract.
When stating that I would be using typical price ranges to value each asset, I forgot to mention that this would be instead of the trading grids use by Alex and Nicky for the same purpose. The image below shows where the optimum in-the-money twenty-minute binary option contract entries would have been for the Nasdaq on Friday, based on the baselines and price range envelopes I cited in the previous post. However, I deleted these indicators in the main chart due to the proprietary nature of those settings, but I kept their associated histograms and oscillator in the lower panel to reflect how each decision was made...
P.S. CORRECTION:
...cease trading via my traditional...
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I am finished with this thread, at least for the time being. In the last week or so, I've been able to generate about $1000 of profit via a $10,000 account, which is proof enough for me that I can make a living trading binary options via the Nadex platform, in spite of this outfit's awful in-the-money contract risk-to-reward structure.
(binary options) =~= (flipping a coin) + economics + (tech analysis)
There were two different strategies used for entering positions in Post #205. One was to do so as soon as price was rejected after the lower-panel oscillator made contact with or breached the upper or lower dotted orange-red line.
The second was to do so when the black histogram peaked on one half of the lower panel midpoint while the orange histogram continued to paint bars on the opposite half of the channel.
The second was to do so when the black histogram peaked on one half of the lower panel midpoint while the orange histogram continued to paint bars on the opposite half of the channel.
Sunday | May 1, 2022 | 2:40 PM PST
As of this weekend, I finished finalizing the protocols for trading the new "Bias Overlap" version of NPP, and given the mechanics of how it works, I think it might be easily applied to the PocketOption platform.
If I'm not too busy trading Nadex Knock-outs, I might give it a shot, along with PocketOption's new trading mode.
As of this weekend, I finished finalizing the protocols for trading the new "Bias Overlap" version of NPP, and given the mechanics of how it works, I think it might be easily applied to the PocketOption platform.
If I'm not too busy trading Nadex Knock-outs, I might give it a shot, along with PocketOption's new trading mode.
Tuesday | May 3, 2022 | 7:30 AM PST
After an intense study of what insights the new perspective on price action offered by the "Bias Overlap" view of the Forex market has to offer, I've concluded that intraday entries should be based on the six-minute baseline, with all other measures (i.e., the 5-, 15-, 20- and 45-minute trends) represented by dynamic/adjustable or standard price range envelopes rather than by moving averages.
On the basis of this theory, I began testing its application on the PocketOption platform this morning via this purchase of a five-minute USDCHF binary option put contract...
After an intense study of what insights the new perspective on price action offered by the "Bias Overlap" view of the Forex market has to offer, I've concluded that intraday entries should be based on the six-minute baseline, with all other measures (i.e., the 5-, 15-, 20- and 45-minute trends) represented by dynamic/adjustable or standard price range envelopes rather than by moving averages.
On the basis of this theory, I began testing its application on the PocketOption platform this morning via this purchase of a five-minute USDCHF binary option put contract...