Ultimately, the experienced traders come to one or several (up to three) profitable trading strategies that are traded daily. The whole point of the matter is that in order to properly align their own approaches in trading, and trade without impacting the deposit, but unloading it with the help of risk diversification to the opposite.
One of these ways is trading the different options expiration times strategies, which means combining short, medium and long-term trading strategies simultaneously.
Let's say you are trading with the minimum skills of technical analysis at the levels of support and resistance. Your advantage is a medium-term trading, and so you use the H4 time interval (timeframe) to find such important levels on the chart.
We have identified the trend support line at the H4 timeframe of GBPJPY currency pair, which has been identified by us on 05.06.2014 and ended 10.07.2014. During this period of time, we had 2 medium-term profitable trades with the «ONE-TOUCH» option with expiration time of 6 days each. These contracts has brought us 600% of the profits, and for the initial lot of 100USD, our two trades generated a net profit of 1200 USD. One should agree, that is a pretty good result. However, let us recall that this is just 2 trades per month.
In addition, when executing the trade, we did not know how this trade would turn out for us. At the same time, sitting and waiting for two weeks for a trade execution is neither an option nor a solution. That is why we go down to the H1 timeframe and look at this period on a larger scale.
We have identified 4 bounces off the trend line in one month on the H1 timeframe and we have also executed 4 trades, one of which generated a loss. Options expiration time was 24 hours which is less long-term in comparison with the previous ones, the payout was 250%. With that said, during the same month we have executed 4 additional trades that profited in 250Õ3=750% and minus 100% due to a losing trade. That means 650% of profit.
With the initial lot of 100 USD, the profit was 650 USD + 1200 USD (earned with long-term trades), which is 1850 USD of net income. That is good but not good enough for a month of trading. We are heading to a lower timeframe of M15 as long as 6 trades a month is not good enough. We are not removing the trend line used for the previous trades as it is going to be our guideline for not executing trades against the main trend direction.
Twelve bounces off the trend lines towards the direction of the main trend were identified by us on the M15 timeframe within a month. We are not going to show you all the screenshots. Of the 12 executed trades: 9 closed with a profit and 3 trades generated losses. Expiration time for the ONE-TOUCH options was 6 hours, and payout for each trade was 150%. Now let us calculate 9X150 = 1350% minus 300% (incurred losses) equals to 1050% of net profit. That is, 1,050 USD out of an initial 100 USD lot. Let us now add the profit from trades, obtained by trading on higher timeframes with other expiration times and profitability, and we've got 1850 USD + 1050 USD = 2900 USD during just 1 month.
At the same time, we combined three ONE-TOUCH option expiration times, the three sizes of payout and did not wait for a whole month to execute 2 trades, but traded almost every day.
The size of the resulting open contracts payout has met all expectations given that the initial trade lot was only 100 USD.
As it has been written earlier, the ONE-TOUCH options are used for the given trading strategy. At the same time we will also use classic binary options. However, you need to use their “Long-term” subtype with the expiration time being in line with the above mentioned trading rules. If your terminal does not have such options, you might pick expiry dates using the "Designer" option. In case there is no such type of option, you may just need to change the broker and choose the one that could provide you with the most popular and necessary options for profitable trading. For selecting the broker company, you may use our broker rating.
As you can see above, a comprehensive approach to trading brings fairly good results. The system, which can earn almost 3000 USD in 1 month of trading with an incoming lot of 100$, is a good system. Do not forget that you are not limited to a single financial instrument. That is, using multiple financial assets will double your profits.
Entering lot of 100 USD must be the 5% maximum for the deposit. That means that if you want to trade such lot then the deposit should be 5000 USD.
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