Get in on Pivot Point Trading and Binaries
We've added a recent collection of potential setups for the Binary Trading markets. This is all based on price action and pivot points each of these currencies created. The three examples will show you the potential of this trading strategy. The best part about these trade setups is how often you can find them on all the different instruments available to you. We only look at two or three different charts. Imagine if you had it setup so you can see much more. This includes stocks, oil, gold, currencies and plenty more.
The first chart is from March 19th, 2012 (Figure1). This is a one minute chart zoomed in so you can see the details of the trade more clear. Prior to the move down on the left side of the chart, there was actually a more significant move downward. This meant the trade was moving south. The move down was part of a secondary move that hit the resistance line(Support) and completely bounced off of it. It actually bounced 8 pips in our favor. This call option would have been perfect to take without any pain. We don’t like taking a secondary move to the pivot right after we just hit the line. Notice how the second time around it moved right through.
Our next trade setup occurred on March 21, 2012 (Figure2). This was a similar type of Binary trading setup as the image above. Notice the pretty steep decline and then we had one huge candle that gave it the extra momentum to the south side. We knew if the next candle hit we should take this call option. This bounce was another no pain bounce that gave us a 6-8 pip winner.
Some things to consider when it comes to trading this EURUSD chart are the fact that we dropped a good 20-30 pips in a short period of time. This gives you more leverage when seeking a bounce versus a follow through. A lot of times currency pairs will consolidate before moving the same direction again. This was a perfect example. It literally poked through the line and came back above within 2 minutes.
This last trade setup had an interesting move that caught our attention. This trade took a few extra minutes of watching, but once it occurred it was very favorable setup. With over a 50 pip move from it’s top we noticed it didn’t really consolidate. However we didn’t want to get in on a call option before it got to the pivot. There were a couple of put option opportunities available if you were looking for those. However, notice how it consolidated finally at around 13:26. We knew that once it broke to the pivot we could enter the call option. The long candle closed at 13:58, so this trade would be the 14:15 binary trade. You also had several candles to enter before it popped. Once it popped you were free and clear with a 10+ pip winner. This stuff happens all the time.
The key to these setups is to be looking for them or have some kind of alert to tell you this is happening. This allows you to just take favorable opportunities.
By: Richard Sobin.