There are many forms of trading that you can learn but if you want to be more profitable then you need to learn something that is advance is efficient. The Swing 15 Minute Technicals can help you with your advance trading needs. This system established on resistant and support breakouts on fifteen minute charts making it ideal for every day trading. This system is very well detailed and can be very simple for expert traders to follow. Signals can be taken from charts with fifteen candlesticks that have either resistance or support lines on longer term charts. Primarily made for British and Euro controlled currency pairs, the Swing can work at any market that is liquid.
What is 15 Minute Swing Binary Option Strategy
15 Minute Swing Binary Option Strategy is a fairly advanced form of trading. The 15 minutes swing trading strategy is actually a standard trading strategy often used by spot forex traders especially when trading the euro or British pound. Nevertheless, it can be adapted for any market which is highly liquid. Trading signals are derived using 15 minutes trading charts as well as longer term charts and is based on the concept of trading support & resistance breakouts. Because of the short time frame, the strategy is also well suited for those who are trading the binary options markets. In terms of its complexity, it is more suited to those traders who are at the intermediate or advanced stage.
Traded pair: EUR/USD, GBP/USD, EUR/JPY, GBP/JPY
Time frame: 15 Min
Trading hours: 5.45 am to 4 pm, GMT (recommended)
How 15 Minute Swing Binary Option Strategy works?
The Swing can be divided to four different sections. Each section details different trade aspects. The strategies first section shows how to take signals and where to take them. The next section show to you can size positions. The third section shows profits targets which are a fact that is not so vital for binary options traders but is vital for forex traders. The last section shows tips on to deploy it and some probable trade factors.
The primary objective of this trading strategy is to trade short term breakouts. In order to do this we need to first isolate areas of resistance or support. In order to find these areas, you will need the following setup:
- 4 hours time frame chart to establish the primary trend as well as the support and resistance level
- 1 hour time frame chart to confirm the trend
- 15 minutes time frame chart to generate the trade signal
To ensure that the support or resistance lines drawn on the 4 hours chart are of any real significance, you need to make sure that they are at least connected at 3 points like the 4 hours EUR/USD chart below.
The strategy’s author, Olivier, shows how you trade and what you trade. In this strategy, he trades shorter term breakouts of resistance and support. You can locate these support and resistance zones by using three varied time frames. You may use a four hour candle chart. If you cannot create a four hour candle chart you can opt to use a half day bar or daily bars if the need arises. This sets up support and resistance and primary trend. To ensure that the lines you are drawing are significant make sure to connect three points the least. When this is done, you go down to the hourly candle charts and repeat the step. To do away with confusion, you may use different colors for different time frames. This allows you to recognize what lines are more vital when you drop to 15 minutes bars in the chart. Once your charts are done all you can do now is wait for a single signal.
Do the same for the 1 hour chart but using a different color to help you differentiate between the different charts. Once you have completed plotting all the necessary support or resistance lines, you just have to wait for the signal to enter your trade. Ideally, all this preparatory work should be carried out before the start of the trading day, so you can start trading straight away once the opening bell sounds. You must do this prior to the trading day’s start so that when the market opens you. Let us take a look at chart which shows us the downtrend which connects through three peaks:
Signals appear if there is a breakout below or above a resistance or a support. Breakouts depend on a close that is either above or below a selected line. A simple line break without a close has to be deemed as a false signal or a whipsaw until it is completed by a close below or above. when there is a close you can now open a position. Open puts for breaks that are below the trend or support. Open calls for breaks just above the trend or support.
The first part of the strategy deals with position sizing and risks and rewards. This part can be linked to position sizing in equity options and is thereby useful for binary options too. The author proposes position size to be a specific percent of your capital which is around one and a half percent. Using this approach, you can limit your losses to good amounts and your trade sizes will also increase as your account also increases.
The third step entails profit targets. For the author, targets are for position additions and for profit taking depending on the trade’s progress. Binary traders can find this useful in identifying if the trade is in a daily or hourly position. When applying this to binary, you must put in mind that the closer the target is to the point of entry, expiration time is also shorter. When target appear on fifteen minute charts you may use hourly or even shorter time.
The trading signal appears when a breakout occurs above or below the support or resistance levels. Depending on the price movement, the breakout can occur at the resistance or support line. In our case above, the breakout occurs at the support line. However, to ensure that it is not a false signal or whipsaw, the prices must close below (for support) or above (for resistance) the line.
In order to size your trade accordingly to the risk/reward ratio, you should never risk more than 1.5% to 3% of your investment capital. So if you start off with $1000, your position size should not be more than $30. By trading in this manner, you are actually limiting your losses to a sustainable level. Only increase the amount to be invested when the overall amount for your investment capital has increased.
Profit targets in the context of this strategy are for determining whether you should take profits or double up. In addition, you can also use profit targets to determine if you should trade on an hourly basis or daily basis. If the target has appeared on your one-hour chart, then you should only choose those options with a one-hour or longer expiration time.
Advantages of 15 Minute Swing Binary Option Strategy
This strategy is good because it makes use of some typical form of trading and offers necessary targets for profits and targets. It does not suck because it makes use of multiple time frame swhich is the basis for most strategies that are successful. This strategy may be predestined for forex but it can be used for binary options.
Disadvantages of 15 Minute Swing Binary Option Strategy
It is not good because novices can benefit from it. It is quite complicated and only seasoned professionals may fully benefit from it. As mentioned before resistance and support are very subjective and trends are very subjective. You can only utilize them well when you are already experienced.
The bottom line
This trading strategy gets the thumbs up because it is suited for trades with a short time frame. In addition, the analysis is drawn from charts with multiple time frames giving it a clearer picture of what is going on in the market.