The «Window» binary options trading system is sure to please thanks to its simplicity and simultaneous efficiency. It is built on a single technical indicator, the special settings of which allow the trader to enter the market on the rise of a new wave of growth or decline in quotes, closing at least 85% of transactions with a profit.
The operating principle of the binary options trading strategy
This trading tactic is a great option for those who do not want to bother with complex indicator templates, since the Moving Average indicator used here is the only analysis tool. Moreover, this indicator is used in the strategy in a single instance, and despite this, the method provides for dynamic capital gains. Many traders have tried to supplement this system with an oscillator, for example the MACD or RSI, but, as practice in trading shows, they are not needed in this case, because they will confirm the already accurate signals. The thing is that the settings of this indicator are adjusted to the pattern of price movement – before making a reversal, the price of the asset moves away from the moving average, creating a kind of window. After this window is formed, the price goes back to the moving average and intersects it, and the market reversal occurs naturally, making it possible to conclude a transaction on it.
Configuring the strategy template
In fact, the only condition for using this system will be the availability on your trading platform of the Moving Average indicator, as well as the ability to change its settings. To show you how to most correctly trade on this strategy, we’ve used the platform from the Binomo broker – it is equipped with the necessary functionality for profitable trading.
So, this system can be used on any currency asset, but the timeframe for the chart should only be M1. Having chosen the asset, you need to add to the chart the Moving Average technical indicator from the platform set with type Simple and set the period for the moving average to 8.
After you complete the template setup, the markup on the chart will look something like this:
Binary trading signals of the “Window” strategy
The signals of this system are also easy to determine on the chart, just like building the template. You need to wait for the window to form between the price of the asset and the moving average, and then enter the market at the moment the quotes intersect the MA curve.
Transactions UP are concluded when
The window is first formed on a downtrend, and then the quotes intersect the MA line in an upward direction. Here’s how it looks on the chart:
Transactions DOWN are concluded when
The window is first formed on an uptrend, and then the quotes intersect the MA line in a downward direction. Here’s how it looks on the chart:
As you can see, this pattern is quite a frequent phenomenon on the market, which allows it to be used as the main trading signal. Thus, when concluding transactions at moments of short-term trend changes, you can earn a profit on 85% of your trading positions.
On the 1-minute interval of the chart, the optimal expiration period for contracts will be 5-7 minutes. During this time, a new price impulse will push quotes in the right direction, and at the time of expiration, the asset price will be in the positive part of the chart. This system can also be used on the M5 timeframe, which will only increase the accuracy of its signals. In that case, the expiration of contracts should be set to 3-5 candles.
The classic risk management rules will help to reduce the level of potential risks. That is, you need to calculate the amount of each transaction to be concluded so that it does not exceed 5% of the volume of your account. If you have a small amount of funds in your trading account, you need to reduce the lot size to the lowest possible. For example, on the Binomo platform the smallest option is only $1, which is optimal for safe trading.