Trading NADEX Knock-Outs
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Anecdotal Observations:
I don't really see anything trending well this morning. I am therefore suspending trading for the week. So then, given that rates rarely take a straight path 40 pips in one direction or another, I would say that generally, I'm trying to trade between the floor and ceiling of the eight- or nine-minute price range, preferably in the direction of the asset's ultimate destination, except that this morning I don't think any such direction/destination exists. This also looks to be approximately the same as the top and bottom of the 40-minute temporal support/resistance levels.
I don't really see anything trending well this morning. I am therefore suspending trading for the week. So then, given that rates rarely take a straight path 40 pips in one direction or another, I would say that generally, I'm trying to trade between the floor and ceiling of the eight- or nine-minute price range, preferably in the direction of the asset's ultimate destination, except that this morning I don't think any such direction/destination exists. This also looks to be approximately the same as the top and bottom of the 40-minute temporal support/resistance levels.
So, here is how I think you can do the above using your new "One-minute Clarity" chart configuration designed specifically for this purpose...
The blue four-minute baseline tracks the short-term ebb and flow of price. You enter positions when this measure crosses the red and orange Battenberg eight-and-a-half-minute baseline and the bold green 11-minute baseline that govern the purchase of binary option contracts on the Nadex platform. Do this as rates are rejected at, or bounce off, the limits of the 15-minute price range envelopes at 0.10% to 0.18% deviation.
Riding the Waves on a One-minute Chart:
The only thing is, this is using a 15-minute price range envelope instead of a nine-minute envelope. So, as soon as you get the chance, compare the two to determine if one of them is better in this role than the other.
(Nine minutes is better.)
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Saturday | May 21, 2022 | 6:00 AM PST
Five questions to ask myself when attempting to trade using the chart configuration from the previous post...
Possible Entry and Exit Strategy:
If the 30-minute baseline and the 1¾-hour temporal support/resistance channel are both conveying that the gist of price flow is in a given direction, enter a position from the associated "backside" of the 30-minute baseline, and pocket your gains when price reaches the opposite band of the 1¾-hour temporal support/resistance channel.
Five questions to ask myself when attempting to trade using the chart configuration from the previous post...
- Did the (blue) four-minute baselines reverse direction in the last few minutes after being rejected by the floor or ceiling of the 1¾-hour temporal support or resistance level?
- Is the (green) 12-minute baseline sloping in the direction of the trade?
- Are the (blue) four-minute, the (red and orange Battenberg) 8½-minute, and the (green) 12-minute baselines properly aligned (and fanning out)?
- Are the (green) 12- and (red) 20-minute baselines angled in the same direction?
- Are the (red) 20- and (thistle) 30-minute baselines aligned in the same direction?
Possible Entry and Exit Strategy:
If the 30-minute baseline and the 1¾-hour temporal support/resistance channel are both conveying that the gist of price flow is in a given direction, enter a position from the associated "backside" of the 30-minute baseline, and pocket your gains when price reaches the opposite band of the 1¾-hour temporal support/resistance channel.
Using the (blue) four-minute, the (crimson and orange Battenberg) 8½-minute, the (green) 12-minute, the (red) 20-minute, and the (thistle) 30-minute baselines to code an indicator that highlights intraday reversals based strictly on the math, this is what I got...
I should be able to make successful trades one after another by entering positions when the black oscillator is on one side of the lower panel price anomaly channel and the gray oscillator is on the other...
I should be able to make successful trades one after another by entering positions when the black oscillator is on one side of the lower panel price anomaly channel and the gray oscillator is on the other...
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I felt so good about the above strategy that I coded lower panel indicators for it to see what would have happened had I been using this tactic to trade a random currency pair on Friday...
It appears to be an ideal strategy for timing the purchase of NADEX in-the-money two-hour binary option contracts less than an hour before expiry. Of course, the risk-to-reward ratios would stink to high heaven. Nonetheless, if such trades almost never failed, it would be a nice, simple way to "earn" an easy $15 a pop.
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Saturday | May 21, 2022 | 4:15 PM PST
After coding indicators/alerts for the two tactics discussed in recent posts plus one more based on what I saw after viewing the first two, it is the third indicator that is my favorite...
I've titled it "1-Minute Reversal II Alert," and calculated it by eliminating the 30-minute baseline from the equation. However, this means that it cannot function as a fully objective indicator, and must be "eyeballed" by the trader to decide which potential trade opportunities to pursue base on which direction it "appears" rates are moving, and whether price just recently bounced off temporal support or resistance. For example, given the above market conditions, a trader might chose to ignore the following signals...
The task of deciding which alerts to ignore and which ones to act on is aided/facilitated by the graphics, but I have chosen not to plot them on the above examples.
There was one more point I wanted to make in relation to all of this, but I have forgotten what it was. Perhaps I will remember later on. In any case, I guess this is all I will have to say for now.
After coding indicators/alerts for the two tactics discussed in recent posts plus one more based on what I saw after viewing the first two, it is the third indicator that is my favorite...
I've titled it "1-Minute Reversal II Alert," and calculated it by eliminating the 30-minute baseline from the equation. However, this means that it cannot function as a fully objective indicator, and must be "eyeballed" by the trader to decide which potential trade opportunities to pursue base on which direction it "appears" rates are moving, and whether price just recently bounced off temporal support or resistance. For example, given the above market conditions, a trader might chose to ignore the following signals...
The task of deciding which alerts to ignore and which ones to act on is aided/facilitated by the graphics, but I have chosen not to plot them on the above examples.
There was one more point I wanted to make in relation to all of this, but I have forgotten what it was. Perhaps I will remember later on. In any case, I guess this is all I will have to say for now.
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Sunday | May 22, 2022 | 10:25 AM PST
When you were trading NADEX binary options, you said to never trade against the (red) 20-minute baseline. Well, it's time to extend that rule to two more measures, to be written in stone, even more so. Namely, never trade against the crimson and gold Battengerg 8½-minute trend line OR the green 11 to 12 minute trend line(s).
On the other hand, it will often make sense to trade against the blue four-minute baselines, because they are going to track or trace pullbacks against a pair's ultimate destination.
When you were trading NADEX binary options, you said to never trade against the (red) 20-minute baseline. Well, it's time to extend that rule to two more measures, to be written in stone, even more so. Namely, never trade against the crimson and gold Battengerg 8½-minute trend line OR the green 11 to 12 minute trend line(s).
On the other hand, it will often make sense to trade against the blue four-minute baselines, because they are going to track or trace pullbacks against a pair's ultimate destination.
Not a very pretty path getting there, but get there it did, nonetheless...
There is no more work that I'll be doing on my charts...only evaluating what price action looks like in comparison to them.