Submit by Dimitri

Overview: The strategy is based on a custom indicator that provides an alert in the form of a white circle drawn on the chart. The alert anticipates a trading signal, and at the opening of the next candle, you enter a position—either a Buy or a Sell. After the trade is opened, an arrow appears, confirming the direction (Buy or Sell).

This strategy is designed to trade binary options with an expiration of 1 candle. The key is to understand the difference between the behavior of the indicator in backtests versus real-time trading.

Step-by-Step Strategy:

1. Understanding the Signal:

• White Circle: This is an alert, not the final signal to enter a trade. The white circle draws on the current candle to suggest that a potential setup is forming.

• Next Candle: You enter the trade at the opening of the candle following the white circle.

• Arrow Confirmation: After entering the trade, an arrow appears, confirming the direction of the signal (either Buy or Sell).

2. Trading Rules:

• Timeframe: Use a timeframe appropriate for short-term trading (e.g., 1 minute or 5 minutes) since the expiration is only 1 candle.

• Expiration: Each trade will expire after 1 candle. If you’re trading a 1-minute chart, the expiration of each option is 1 minute.

• Entry:

  • Wait for the white circle to appear during the current candle.

  • As soon as the next candle opens, enter the trade based on the anticipated signal (Buy or Sell).

  • Buy Signal: Enter a Buy position at the opening of the next candle.

  • Sell Signal: Enter a Sell position at the opening of the next candle.

3. Backtest Charts vs. Real-Time Behavior:

• In backtests, the white circle and arrow might appear neatly, giving a visual understanding of how the trades would have worked in the past. This makes it easier to analyze historical performance.

• In real-time, the behavior might be more dynamic. The white circle gives you advance notice, but the arrow confirming the direction may appear after you've already entered the trade.

  • Important: Backtests can show more perfect signals than you will experience in real-time trading. The goal is to familiarize yourself with how the indicator "paints" these signals in live conditions.

4. Managing Expectations in Real-Time:

• Lag in Signal Confirmation: Be prepared that the arrow will only appear after entering the trade, and it can occasionally differ from what you anticipated based on the white circle.

• Market Conditions: The indicator may behave differently under varying market conditions (ranging vs. trending markets), so understand its performance in both types of markets through backtesting and forward testing.

5. Risk Management:

• Fixed Percentage Risk Per Trade: It’s advisable to use a fixed percentage of your account balance per trade (e.g., 1-2% of your capital) to avoid overexposure.

• Loss Limitation: If the strategy results in consecutive losses (e.g., 3-5 in a row), stop trading and reassess market conditions or strategy performance.

Example of Strategy in Action:

1. White Circle Alert: A white circle appears on the current candle. You know this is an indication that a signal might be forming.

2. Next Candle (Opening): At the opening of the next candle (after the white circle), you immediately take action:

   • If the white circle suggests a potential upward move, you enter a Buy trade.

   • If the white circle suggests a potential downward move, you enter a Sell trade.

3. Arrow Confirmation: After you’ve entered the trade, an arrow appears to confirm the direction of the signal. This is a form of post-entry validation.

Market Conditions: Avoid trading in highly volatile or unpredictable market conditions (e.g., during major news releases).

• Currency Pairs/Assets: Stick to assets that are stable and liquid (e.g., major forex pairs, high-volume stocks, or indices).

• Practice on a Demo Account: Since the real-time indicator behaves differently, practice on a demo account to familiarize yourself with how the indicator operates in live market conditions. 

Submit by Maximo Trader 10/08/2010

This Strategy Binary Options is based on the metatrader indicators: JMO and Pivot Points Levels but is inspired at 1hr trading system Levels Reversal but i have add a new indicator for filter(P.magic rainbow v.7).

Time Frame 240 minutes: Exiperes time 240 min or 480 depends by depends on the risk that one is willing to accept.

Currency pairs any.

Markets: Forex, Stocks, CFD, Futurex, Gold, Silver and Oil.

Metatrader Indicators:

Pivot points Levels,

JMO indicator.

P-magic Rainbow .v.7 (for filter).

Buy

When that the price breaks a support Pivot Point level, wait that jmo indicator come back up from overbought area and crosses upward.

This condition is reliable if P-Magic Rainbow does not break the upper band.

P-Rainbow Magic should fluctuate within the bands.

Sell

When that the price breaks a resistant Pivot point level, wait that jmo indicator come back down from oversold area and crosses downward.

 This condition is reliable if P-Magic Rainbow does not break the Lower band.

P-Rainbow Magic should fluctuate within the bands.

Pivot Point Levels Reversal:  Binary options One/Touch

Time Frame 240 minutes: Exiperes time 960 min

 The Trading Rules are the same.

In the examples   Pivot Point Levels Reversal  in action

Level Reversal Trading system

Binary Options Strategy

Binary Options Strategy: Buy-Sell

Binary Options Strategy:Pivot Point levels Reversal

The Attack of the Viper: Binary Options Strategy