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Home Rating strategies The strategy of binary options Breakdown of morning flat

The strategy of binary options Breakdown of morning flat

Strategy characteristics

Risk
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Profit
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Suitable options: RANGE option, classical binary options Choose a broker
Expiry time: 6 hours, 8 hours

Now, we are going to examine trading strategy, which is used by many traders all over the world. The strategy is based on one market phenomenon – breakdown by quotation of the price of the box, formed during Asian trading session, to be more precise, at the second part of it.

As a rule, early in the morning, during the end of session on financial markets of Asian countries, clear flat canal is formed, later professional traders from Europe and America are trying to break it down during trades on mentioned currency, trading and share markets.


On the screen above the boundaries of canals are depicted, which are build according to high and low price corridors of Asian market. As you see, at the certain moment, the price starts moving intensively and breaks down depicted canals in one of directions. Such price moving are seen after the opening of European market and finish at the second half of American session of the market, practically any available for trading financial asset.

TRADING RULES

Practically in every web-terminal, for binary options trading there is such option, which is called RANGE, the condition of getting it is to reach by price and next liquidating of given price levels. That is at the moment of expiration of RANGE option (its kind is OUT-RANGE), the price must be behind the boundaries of fixed strike-levels.

Thus, knowing that after the end of Asian session traders form Europe will break down fixed price canal in one of the sides, we can every day till opening “Europe”, at 9.00 of Moscow tome, close a deal by RANGE option (its OUT-RANGE) for breaking down the morning flat.


As you see, every time, after the start of European session, the asset price rushed into one of the sides and till the end of trades in Europe, it reached rather good levels for getting profit by OUT-RANGE option, its condition is to liquid by price of one of fixed strike-levels.

APPROPRIATE OPTIONS

For trading with this system, you can use classical binary options. However, their kind, which suggests average duration of expiration time of contracts. That is not less than 8 hours. Such conditions you can find in «Constructor» option.

But we should close a deal by binary option for increasing or decreasing when we reach by the price of one of fixed on the chart checkpoints, which is built according to price minimum and maximum of Asian session. That is, if the price reached and crossed the level of upper canal, we close a deal for purchase– Call – option, but if the price crossed lower level of the canal, then we sell - Put – option.

If the price at first touched upper price level, and you closed a deal for purchase, and then the price turned back and touched lower price level, you need to close a deal for sale with this instrument. Thus, you will almost exclude losses, which take just 15%, as one deal will bring you guaranteed profit, which will compensate loss in the second deal.


The indicator you see on screens you can download here. This indicator for trading terminal MT4 will put such price checkpoints for trading every morning.

EXPIRATION TIME

As it has been mentioned above, you need about 8 hours to reach by price of one of the given price levels. Thus, it is necessary to start from this expiration time of contract.

PROFITABILITY

The profitability of OUT-RANGE option with expiration time 8 hours is about 200%. That is , investing in your deal 100 USD you will get 200 USD of clear profit.

How can you find a broker with options OUT-RANGE? Get to know our rating of binary options brokers, where there is full description of offered by them options for trading. However, you need to sort out such kind of options with average conditions of contact expiration that is not less than 6 hours.

MONEYMANAGEMENT

For the given trading system, there are appropriate classical rules of money management. That is, in one deal you can use only 2% from the size of your deposit. Taking into account big probability of working out trading signals, which is about 74%, we can use the rules of Martingale for coming out from slump. That is, getting loss in one deal, you need to increase the next lot in two times. Thus, you can compensate the loss and earn in addition in the result of profit you got.



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