The process of trade on the market of binary options is closely related to a wide range of approaches and quote analysis tools for the generation of highly accurate trading predictions. Today, we will examine a trading strategy for a financial market tool based on a specific format of displaying quotes, which does not require additional tools and provides clear trading signals and high productivity. We’re talking about binary options best strategy candlestick patterns that form quotes upon construction of the asset chart.
So, after choosing the candlestick quote format, on the chart we can see a large number of different patterns that allow you to accurately determine the future trend of price movement of the underlying asset. We will not delve into complex models, but will consider a simple combination of Japanese candlestick building, which allows you to clearly identify a reversal of trend movement.
The «Candlestick reversal pattern» trading system
A model of trend reversal is called «Candlestick absorption.» This market situation is very simple to identify on the quote chart. A classic example of a candlestick absorption model looks like this on the quote chart:
- During a clear growing trend on the chart, a downward price candlestick forms, whose body, without taking into account shadows, completely covers the quote candlestick that was formed in front of it:
As you can see in the example, the quote trend, after the formation of such a model, has changed its building direction, and that happens in 95% of cases.
For a downtrend, the candlestick reversal pattern takes the following look:
- On a strongly pronounced quote downtrend, a growing candlestick appears covering the previous downward price candlestick with its body:
And the quotes again radically change the building direction of their trend movement.
This pattern of fluctuations in candlestick quotes of the underlying asset can be used with high efficiency in binary trading to receive a consistently high level of trading profit as well.
In practice, it looks quite simple:
Contracts are registered immediately after the candlestick trend reversal pattern has been formed. It is necessary to wait for the complete formation of this market situation. Contracts UP are registered upon the formation of the bullish candlestick absorption model:
Binary options DOWN are opened upon the formation of a bearish candlestick absorption model:
When using a trading system of this type, the core moment is the accuracy of the asset quotes, as well as the choice of assets and trading conditions offered by the broker for trading. The Binomo broker’s terminal is the example of an optimal and highly efficient trading platform for candlestick patterns, where the market participant receives the following opportunities, conditions, and services for trading:
- The best wide range of underlying assets
- A high-tech trading terminal with accurate quotes from a well-known liquidity provider
- The required contract maturity range (expiration terms)
- The contracts with high-speed processing
- The required quote display mode (candlesticks)
- Options yields with higher rates — up to 90%
- Trading conditions with minimal parameters — cost of contracts from $1, the amount of an account balance from $10
Besides that, clients receive a perfect choice of analytics and free professional trading training on the Binomo broker’s site.
The «Candlestick reversal pattern» trading system provides the best results when used on trading contracts with a maturity period of 120 seconds to 5 minutes, in conjunction with proper money management, the rules of which follow the classic parameters — trading risk is reduced by using the minimal cost of the contract, the maximal level of trading risks is set to a contract cost limit of 3% of the amount of operating funds.