Strategies on the patterns for binary options: “Three White Soldiers” and “Three Black Crows”
Three White Soldiers and Three Black Crows are Price Action chart patterns, which have a very high response statistics. The statistics of working off the signals is approximately 87%. Thus, trading under these patterns is very effective for binary options trading, while at the same time being easy to read the signals provided by these chart patterns.
So, Three White Soldiers is a reversal pattern and tells us about the upcoming downtrend reversal in the near term. That is, Three White Soldiers is a pattern that indicates only the beginning of the phase of the active quotes growth. At that, this pattern appears at the very bottom of the market.
Thus, after the appearance of the Three White Soldiers pattern, the falling market in 87% of cases reverses and begins an upward movement.
Three Black Crows is a mirror image of the previous pattern and in essence indicates the reversal of the rising trend to a falling. That is, this pattern is the trend breakpoint and appears at the top of the market.
Thus, after the appearance of the Three Black Ñrows pattern, a growing market in 87% of cases reverses and a downward movement begins.
How to use these patterns to trade binary options?
Given the strength of these patterns and good statistics of their working off, this type of chart analysis can and should be applied in binary options trading. However, we should note the fact that the pattern is more suitable for quotes charts starting from H4.
Thus, the application of the pattern is only possible for binary options with longer order lifetimes, such as the ONE-TOUCH and RANGE with expiration times of 24 hours or more. That is, having seen the formation of the Three White Soldiers or Three Black Crows patterns, we can with great probability tell about the appearance of a new, sufficiently strong trend.
So, this is a great opportunity to earn good money, because the ONE-TOUCH and RANGE options are the most profitable options, percentage of payouts on which, at times, reaches 600%-700%. Failed to work off the pattern this time? Do not worry, the high percentage of working off the signals will still bring you more profits than potential losses, as only 1 out of 3 deals will be unprofitable.
What financial instruments to choose for trading?
To trade under the Three White Soldiers and Three Black Crows patterns, you must choose the currency pairs, and the most volatile of them. That is, you can choose EUR/JPY, GBP/JPY, GBP/USD, daily range of which is about 120-200 points, which will allow you to quickly reach the strike levels and get profit. At the same time, there are traders who claim that this trading approach is applied to other instruments from the stocks, indices and commodities.
Important: if you decided to try your hand at trading under these patterns, pre-test this strategy in the MT4 strategy tester or on history of quotations, which will allow to more clearly understand the nature of trading itself, as well as to avoid possible losses associated with misunderstanding of the points of entry under the system.
Given the fact that this type of pattern shows the trend breakpoints, after it appears we can expect the strongest trend unilateral movement. In view of the foregoing, you can use the classic binary options in trading under this pattern, OUT-RANGE options on the breakthrough of the price channel, TOUCH on the touch of a given strike level, and BELOW on the recovery of a preset price level.
Trading under the “Three White Soldiers” and “Three Black Crows” patterns is medium-term trading. Identifying patterns is carried out on at least H4 timeframes, and the options expiration time must be at least 23 hours.
Correctly identified patterns give us a signal with about 87% working off accuracy. Thus, the “Three White Soldiers” and “Three Black Crows” patterns are the most profitable patterns of all the chart candlestick patterns. Given that we have to use options with expiration times of at least 23 hours or more in pattern trading, the payouts on which reach about 200%, the profitability of this trading system is very high. The only drawback is that the pattern emerges and is identified only at the places of the trend breakpoints, which are not so common.
We need to take a lot with the volume of 5% of the size of the deposit when trading under these patterns. With the good enough profitability of the system, your deposit will begin to grow very quickly, especially given the fact that you can trade under the pattern using up to 10 financial instruments at a time.
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