NADEX Trial
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Sunday / February 2, 2020 / 8:00 PM PST
NADEX NOTES...
NADEX NOTES...
- Remember that when you are trading two-hour binary options you have to hit the stupid refresh button every hour!
- Also, never forget to double check to make sure each and every order transfers from "working" to "open."
- And when using the "WEC" approach, you might sometimes have to enter trades based solely on structure, before you have confirmation. (You were going to purchase an AUDUSD call contract, but waited for the trigger signal, and as soon as you got it, the rate suddenly "popped" so that the contract was no longer even worth buying.)
- At 1.3159 with a bullish day-to-day bias, GBPUSD might be positioned where last week's charts positioned strike prices which ended up in the money at expiry, so go ahead and purchase a 15-hour at-the-money call contract and see what happens.
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GBPUSD did not stop at 1.3159, so perhaps it is initiating a southbound reversal. Nevertheless, as it approaches 1.3093 it is nearing a level of significant statistical support, with ultimate support at 1.3042, so it will be interesting to see if the pair does not pull back at least temporarily from the area in which it is presently located (1.3098) over the next six or so hours.
Based on the one-hour chart I just converted from an impressive (from my point of view) four-hour chart, I calculated strong support in the neighborhood of 1.3069 to 1.3087.
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Monday / February 3, 2020 / 6:45 PM PST
So here are the envelopes from my three chart setups...
Obviously the second two include the same ones with different settings, so I will adopt the Nadex parameters and drop the ones used on the Limit Chart. I will also adjust the tan channel on the Limit Chart. (The envelopes I’m using on the Proving My Theory configuration will remain the same.)
Since it appears I’m going to lose money on the GBPUSD contract, and AUDJPY’s rate has not dropped so dramatically that I feel confident there is no way it will come back to bite me, I’m going to pocket my gains from AUDJPY now and leave the other $30 or so on the table—the reason being my goal is to always (if possible) finish the day with more money than when I started, and at this point, I can do that with what I have.
So here are the envelopes from my three chart setups...
Obviously the second two include the same ones with different settings, so I will adopt the Nadex parameters and drop the ones used on the Limit Chart. I will also adjust the tan channel on the Limit Chart. (The envelopes I’m using on the Proving My Theory configuration will remain the same.)
Since it appears I’m going to lose money on the GBPUSD contract, and AUDJPY’s rate has not dropped so dramatically that I feel confident there is no way it will come back to bite me, I’m going to pocket my gains from AUDJPY now and leave the other $30 or so on the table—the reason being my goal is to always (if possible) finish the day with more money than when I started, and at this point, I can do that with what I have.
In the last week I found myself taking the waves-cycles-envelopes-price ranges approach I use for trading to a new level, so that I am now tempted to go ahead and trade via Nadex. It would mean shattering the 1% rule all to smithereens, but given the apparent validity, reliability, and accuracy of the data I'm using, if I typically purchase two-hour contracts during the last 30 minutes and monitor my positions to get out with only limited hits should circumstances turn against me, I will realize more bang for my buck than is possible with any other vehicle as regulations now stand in the USA, so I just might go for it.
With my last two trades of the day I essentially got my thirty bucks anyway!
This is why I'm willing to forego two birds in the bush when I already have one bird in the hand. (There will always be other opportunities!)
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The experimental phase I think is over. It appears to me that WEC can indeed be implemented profitably via Nadex, so I just transferred my OANDA balance back to my bank account so I can then transfer it over to Nadex. I'm therefore finished here, hopefully for good, and can go back to exploring how others have envisioned the application of cycles, waves and envelopes to trading financial instruments (until I resume live trading).
WEC Guidelines Governing the Profitable Use of NADEX as a Vehicle for Buying and Selling Forex Derivatives Online
Copyright © 2020 by Fred Duckworth
Copyright © 2020 by Fred Duckworth
- Observe price action over an extended period of time (preferably years) to get a good idea of how exchange rates typically move in order to develop a strong sense of familiarity with the general behavior of foreign currency pairs.
- Double check to make sure no economic data/news is scheduled to be released during the time periods you will be holding open positions.
- If possible, trade during the hours that the market tends to evidence the least amount of volatility—typically during the hours between 2 AM - 4 AM, 9 AM - 1 PM, and 7 PM - 9 PM Pacific Standard Time.
- Quantify the price ranges exhibited by foreign currency pairs in each of the standard time frames in terms of the frequency and amplitude of the waves/cycles formed in the wake of price action, and then use this data to identify strategic entry and exit points likely to correspond to the key levels where market makers reverse trends so as to enter and/or exit their positions with liquidity. Then choose the most logical strike prices for two-hour in-the-money binary option contracts based on this insight/information.
- Monitor your trades in case it becomes necessary to exit positions early due to circumstances turning against you so that you avoid suffering the unenviable experience of having multiple wins wiped out by a single loss.
- If possible, always place your orders during the final 15 to 30 minutes of two-hour contracts so you are never stuck staring at your laptop for extended periods of time, and so you give the market the smallest possible window of opportunity to turn against you, thereby causing you to lose money and/or forcing you to exit positions before expiry.