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Essential checklists
for traders
1
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How to Get the Most Out of This Book Thank you for downloading “Nadex ® Warriors: Learning Binary Options from the Pros” . Pros” . This book is designed for beginning, intermediate and advanced traders. The authors in this book are leading
experts in trading a variety of nancial markets. As you read this book, you will be exposed to multiple methodologies and checklists for organizing your daily, daily, weekly, monthly and quarterly trading activities. The chapters in this book are divided into two sections: •
“The Game Plan” – An introduction to the trading methodology methodology.. The strategy
is then thoroughly explained along with illustrations and examples. •
“The Movie” – A video that completely describes the strategy discussed in the chapter.
•
“Special Offers” – If you really like a strategy, you can follow the presenter and the strategy. There are thousands of dollars’ worth of trading tools, indicators, training and mentoring services, books and videos available at steeply discounted prices.
In short, you will have all of the information you need to trade your new favorite strategy tomorrow. Some of the things you will learn in this book are: • • • • • • •
A simple strategy for pivoting your way to prots The “Sharpshooter” method for trading 5-minute binaries
How to use the 80% Rule to make directional trades How to prot from trading Inverse Currency Pairs on News Events Trading Crude Oil and Natural Gas News with Binary Options An Afternoon trade on the GBP/USD and EUR/USD An All-Day Nadex Trading Plan
At TradingPub , it is our sincere hope that you take away several new ideas you can use when you are done reading this book. You You will also learn about markets that you currently don’t trade, and you may nd out if they are suited to your trading personality. Finally, make sure to subscribe to TradingPub . We provide free eBooks, webinars, on-demand
videos and many other publications for active traders in all of the markets. Our contributors are world-renowned industry experts and our content is provided free of charge in a relaxed and friendly setting. Cheers to improved condence and consistency in your trading and investing activities! Nadex® is a registered service mark of IG Group ltd. None of the authors featured in this eBook are afliated with either Nadex or IG Group ltd., and neither Nadex, IG Group ltd., nor their afliates sponsor or endorse any of the authors, this eBook, or any other products produced or services
provided by the authors in any way.
Table of Contents GETTING STARTED WITH NADEX® BINARY OPTIONS
5
PIVOTING INTO PROFITS WITH BINARY OPTIONS
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By Gail Mercer, TradersHelpDesk.com
trading 5-minute binaries with the sharpshooter system
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By Darrell Martin, Apex Investing Institute
the 80% Rule Applied to Binary Options
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By Sean Jantz, Binary Trade Group
Using Bollinger Bands to Trade Binary Options
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By Tradën Group
Trading High Impact News With Inverse Currency Pairs
43
By Khari Lane, Wildcat Investment Strategies
An Afternoon Trade With The GBP/USD And EUR/USD
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By Krystal Comber, SlickTrade.net
Trading Crude Oil and Natural Gas News with Binary Options
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By Cam White, TradingPub
a full day of trading Opportunities with Controlling Candlesticks By Cam White, TradingPub
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Getting Started with Nadex Binary Options
®
If you trade Stocks, Options, Futures or Forex, every decision starts with your opinion about the direction of the market you are trading. Is the market on an uptrend, downtrend, or is it trading sideways? Once you have determined the direction of the market, then you must decide which trading strategy gives you the best edge. Is it a trend-following strategy, or is it a scalping/fading strategy for a sideways-moving market? Finally, how do you manage your trade to minimize your risk and maximize your gains? What are the best entry opportunities? Where do you place your stops and take prot targets? Trading involves risk, which needs to be carefully managed. If you trade heavily leveraged instruments like futures or forex, it is possible to lose substantially more than your initial
investment. On January 15, 2015 the Swiss Franc “ash crash” blew through stops and caused many Forex brokers and traders to incur huge losses. Sudden market moves
routinely stop-out trades, which can be a source of frustration for many. If you want the certainty of trading in an environment where your maximum risk and r eward are known in advance, then Nadex binary options and Nadex spreads may be the instrument that is best suited to your trading personality.
What is Nadex? Nadex is the North American Derivatives Exchange. Based in Chicago, Nadex is a whollyowned subsidiary of the IG Group, an international trading company that is headquartered in London and listed on the FTSE 250 exchange. Here are a few other facts about Nadex:
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•
Nadex is a US federally regulated exchange – Nadex is subject to strict oversight
and regulation by the U.S. Commodity Futures Trading Commission (CFTC). •
All member funds are held in a segregated bank account with a major banking institution.
•
No Broker Needed – When you place a trade with Nadex, your order is placed directly on the exchange and not through a broker.
•
Full transparency on every trade – Nadex does not take positions on any
trades, so they have no vested interest in whether your trade wins or loses. Nadex receives revenues from charging a small $.90 cent execution fee and a $.90 cent settlement fee per contract traded. Nadex employees are not allowed to trade Nadex. •
Nadex is now available in 47 countries – Nadex was previously only available
to legal residents of the United States, Canada, Mexico and US Territories. As of March 2015, Nadex is now available in 49 countries.
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What are Nadex Binary Options? Nadex binary options can best be described as “True” or “False” trades. With Nadex, you are making a trading decision about the likely direction of a major index, commodity, forex pair, etc. relative to a xed strike price within a dened time period of your choosing. Nadex binary options contracts are valued at exactly $100 per contract. That means the absolute most you can make or lose per contract traded is $100. When you place a trade with Nadex, you always know your maximum prot and maximum loss before you place your trade. Nadex is a federally regulated exchange (CFTC) that matches buyers with sellers for every contract traded. If you buy a Nadex contract on Gold futures at $60 risk per contract, then Nadex matches you with a seller who is risking $40 per contract, for a sum total of $100. When the trade expires, one person is “right” and one person is “wrong”. The winner receives $100, the loser receives $0. Nadex makes money by collecting $.90 cent trade execution and settlement fees, per contract traded. Execution and settlement fees are capped at 10 contracts per trade. That means if you have a successful trade with 10 contracts trade, your execution and settlement fees would be $9.00 per side or $18.00 round-trip. If you traded 20 contracts on the same trade your total exchange fees would also be $18.00. One of the best features of Nadex is that you are not charged a settlement fee if your trade expires out of the money for a full loss. You are only charged for the $.90 execution fee, per contract.
Nadex does not take positions in any of the assets being traded, so you are never trading against the “house”. Rather, Nadex facilitates transactions between your opinion on a proposition, and another trader who takes an opposing opinion on the same proposition. Placing trades on Nadex can be easily broken down into a few simple steps: 1. Everything starts with your opinion on the direction of a market. Is it on an uptrend, on a downtrend, or is it trading sideways?
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2. Choose the asset you want to trade: a. Major Stock Indices (S&P 500, NASDAQ, FTSE, DAX, etc.) b. Commodities (Crude Oil, Gold, Silver, Natural Gas, Soybeans, etc.) c. Forex Pairs (GBP/USD, EUR/USD, GBP/JPY, USD/CHF, etc.) d. Bitcoin and News Events 3. Select your contract expiration timeframe, depending on your trading personality: a. Weekly Expiration (close of Market on Friday) b. Daily Expiration (close of Market daily) c. Intraday Hourly Expiration d. 20-minute Binary Options (US Indices Only) e. 5-minute Binary Options (Selected Currency Pairs)
4. Select a Nadex Strike Price, and determine if you are going to BUY or SELL. a. How many contracts do you plan to trade? b. What is the price you are willing to pay for each contract? c. Once you have made your decision, place your order directly on the exchange. 5. Once your trade is accepted, you have two options to manage your trade: a. Let the trade run until expiration and collect your maximum prot or lose your maximum risk. b. Or you can choose to exit your trade early and lock in prots or minimize losses.
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How to Place an order with Nadex
On this order ticket, we are looking at the US 500 Market (S&P 500 Futures) 1. Contract: US 500 (Jun) >2075.0 2. Date: April 7, 2015 3. Expiration of Contract: 4:15pm EST (close of market)
4. Time left until expiration: 55 min., 35 sec. 5. Nadex Indicative Index: Current price of the market is 2076.750
6. Offer/BUY Price: $69 ($69 max risk/$31 max reward) 7. Bid/SELL Price: $63 ($37 max risk/$63 max reward) 8. Size: Number of contracts being traded 9. Price: Price per contract traded a. The price box is automatically populated with the current bid/offer price for a market order.
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b. You can manually adjust the price to reect a better risk/reward. When you
do this the order will become a “working order” and will only become an active order if there is a market for your order.
10. Max Risk: $69 to BUY this contract 11. Max Reward: $31 to BUY this contract At a glance, the Order Ticket gives you everything you need to know about this contract. Summing it all up here’s how you place an order with Nadex: •
Make a decision about the probable direction of a market
•
Select the expiration time you want
•
Select a Nadex strike price
•
Are you BUYING or SELLING this proposition?
•
How many contracts?
•
At what price?
Let’s take a look at an example of a Nadex trade on the Germany 30 (DAX) Index:
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In this example using the Germany 30 (DAX) Index, we are looking at a trading period starting at 7am EST, and expiring at 9am EST. The market had been on a downtrend going into the 7:00 hour, where a reversal started to occur. At 7:25am, the market was at 10734. Where would the market be at the 9:00 expiration?
With 1 ½ hours left in the trade, Nadex offered three nearby strike prices to choose from on the strike price ladder on the right side of the chart: •
At the Money Trade (<10734) – For this statement to be “TRUE” the market would have to expire ABOVE 10734 at the 9:00am expiration. The statement is “FALSE” if the market expires at or below 10734. Since the market is currently at 10734, buyers and sellers for this statement are almost evenly split. ○ If you place a BUY order on this proposition, then you will incur a $54.50 maximum risk, in order to make a $45.50 maximum reward. Nadex deducts $54.50 from your account, plus a $.90 cent execution fee. If the market expires above 10734 at 9:00am, you receive a $100 payout, less a $.90 settlement fee. If the market expires at or below 10734 at 9:00am, you receive a $0 payout. ○ If you place a SELL order on this proposition, then you will incur a $52.00 maximum risk, in order to make a $48.00 maximum reward. Nadex deducts $52.00 from your account, plus a $.90 cent execution fee. If the market expires at or below 10734 at 9:00am, you receive a $100 payout, less a $.90 settlement fee. If the market expires at or below 10734 at 9:00am, you receive a $0 payout.
•
In the Money Trade (>10714) – If you are a BUYER, this strike price is in the money, since the current market at 10734 is already signicantly above that strike price of 10714. Since the probability of a successful expiration is much greater at this strike price, you are risking a maximum of $83.50 to make a maximum of $16.50. Nadex deducts $83.50 from your account, plus a $.90 cent execution
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fee. If the market expires above 10714 at 9:00am, you receive a $100 payout, less a $.90 settlement fee. If the market expires at or below 10714 at 9:00am, you receive a $0 payout. The marketplace of buyers and sellers has determined that there’s an 83.5 percent chance that this trade will expire above 10714. If you are a SELLER at this strike price, then you are placing an out of the money
trade. Since the probability of a successful expiration is much lower at this strike price, you are risking a maximum of $23.00 to make a maximum of $77.00. Nadex deducts $23.00 from your account, plus a $.90 cent execution fee. If the market expires at or below 10714 at 9:00am, you receive a $100 payout, less a $.90 settlement fee. If the market expires above 10714 at 9:00am, you receive a $0 payout. The marketplace of buyers and sellers has determined that there’s a 23 percent chance that this trade will expire at or below 10714. •
Out of the Money Trade (>10754) – If you are a BUYER, this strike price is out of the money, since the current market at 10734 is already signicantly below that strike price of 10754. Since the probability of a successful expiration is much lower at this strike price, you are risking a maximum of $25.00 to make a maximum of $75.00. Nadex deducts $25.00 from your account, plus a $.90 cent execution fee. If the market expires above 10754 at 9:00am, you receive a $100 payout, less a $.90 settlement fee. If the market expires at or below 10754 at 9:00am, you receive a $0 payout. The marketplace of buyers and sellers has determined that there’s a 25 percent chance that this trade will expire above 10754. If you are a SELLER at this strike, then you are placing an in the money trade. Since the probability of a successful expiration is much higher at this strike price,
you are risking a maximum of $81.50 to make a maximum of $18.50. Nadex deducts $81.50 from your account, plus a $.90 cent execution fee. If the market expires at or below 10754 at 9:00am, you receive a $100 payout, less a $.90 settlement fee. If the market expires above 10754 at 9:00am, you receive a $0 payout. The marketplace of buyers and sellers has determined that there’s an
81.5 percent chance that this trade will expire at or below 10754.
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Let’s take a look and see how this trade played out:
At 9:00am, the market expired at 10761.567
•
If you placed the At the Money “BUY” order at >10734, your trade would have
expired in the money for a $100 payout and a full prot of $45.50, less a $.90 cent settlement fee, per contract traded. If you had placed “SELL” order at >10734, you would have received $0 at expiration. •
If you placed the In the Money “BUY” order at >10714, your trade would have
expired in the money for a $100 payout and full prot of $16.50, less a $.90 cent settlement fee, per contract traded. If you had placed “SELL” order at >10714, you would have received $0 at expiration. •
If you placed the Out of the Money “BUY” order at >10754, your trade would have
expired out the money and you would have received $0. If you had placed “SELL” order at >10754, you would have been in the money, for a $100 payout and a full prot of $18.50, less a $.90 cent settlement fee, per contract traded. Depending on your technical analysis, and your risk/reward preferences, there are many ways to trade with Nadex binary options.
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Advantages to trading with Nadex: •
As long as your trade is active, you cannot be “stopped-out”. The only thing
that matters is where the price of the market will be at expiration. If you hold your contract until expiration, your payout will be either $100 or $0 per contract. • You always know your maximum risk and maximum reward before you place
your trade. There is no way you can lose more than your original investment in a
trade. There are no margin calls with Nadex. • You are making an “Up” or “Down” decision about the market relative to a
strike price. With Nadex, you are not counting pips. If you win by one pip, you
win the full prot at expiration. Conversely, if you lose by one pip. You forfeit the amount of money you risked in the trade. • You can trade multiple markets with Nadex:
○ Popular Indices ○ Commodities ○ Forex Pairs ○ Bitcoin and News events •
If your trade expires out of the money for a loss, you are charged an execution fee, but you are not charged a settlement fee.
•
Nadex is a regulated exchange
○ Nadex is headquartered in Chicago, and is regulated by the CFTC ○ All member funds are held in a segregated account ○ Nadex does not take positions in any of the instruments the offer for trading
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• You can open a Nadex trading account for as little as $100.
○ Unlike other trading accounts that can require initial investments of $5,000, $10,000 or $25,000, you can get started trading with Nadex for a fraction of the cost of other instruments. •
No Broker Required – When you place an order with Nadex, your order is placed directly on the exchange. Instead of paying broker commissions, you are charged
$.90 cents per contract, per side ($1.80 round trip fees per contract). The maximum commission you will ever pay on one trade is $18.00 (10+ contracts) •
Nadex is now open in 47 countries – Nadex was previously available only to
legal residents of the United States, Canada, Mexico and U.S. Territories. Opening a Free Nadex Demo Account
It doesn’t get much simpler to open up a 2-week Nadex Demo account, funded with $25,000 in play money. Just create a demo name and provide your name, telephone number and email address.
You will have complete access to the entire Nadex Trading Platform for 2 weeks. Use your favorite trading strategies or the strategies in this book and see if Nadex is right for you. Click Here to sign up for a free 2-week Nadex demo account. If you have already looked at Nadex and want to fund a live account for as little as $100, then click here. Once you have placed your rst trade, your Nadex demo account will be extended for up to a full year.
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Free Links to Nadex Resources: •
The Probability Report: This monthly blog newsletter lists a calendar of free
weekly educational webinars hosted by Nadex, along with articles and videos explaining how to trade with Nadex. The Probability Report is free and produced by TradingPub. •
TradingPub Nadex Library: TradingPub maintains a growing library of Nadex
articles, webinars and videos. •
The Inquisitive Trader Blog: TradingPub’s Cam White takes a look at Nadex
trading strategies, and routinely breaks down Nadex trades in his “Trade of the Day” column. The rest of this book is dedicated to Nadex trading strategies you can test tomorrow. If you haven’t tried Nadex, make sure to load up your free demo account to get started!
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Open a Free Nadex Demo Account and Get the Most out of this Book!
It’s as Easy as 1-2-3! 1. Go to the Nadex Demo Page 2. Create a unique demo user name 3. Fill in your name, telephone number and email address That’s it! You will have access to a free 2-week Nadex demo platform funded with $25,000 in play money. Use your Nadex demo account to test your favorite strategies in this book.
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Pivoting Into Profits with Binary Options By Gail Mercer, TradersHelpDesk.com
The Pivoting into Prots trade strategy utilizes candlestick formations with support and resistance from a higher timeframe. Since the Pivoting into Prots trade setup projects where price will likely go, risk can be lowered by using Out of the Money (OTM) binary options versus the more expensive At the Money (ATM) options. Additionally, since using out of the money binaries lowers the risk, prot potential is increased. The beauty of the Pivoting into Prots Strategy is that it can be used on any timeframe and any market. To determine your expiration, calculate a minimum of 3 bars moving in your
direction for the timeframe you are trading, i.e. a 5 minute trading timeframe equals a 20 minute binary option, a fteen minute trading timeframe uses a two hour binary expiration, or if using a sixty minute timeframe use a daily expiration, or if trading a daily timeframe, use
the weekly expiration. Before discussing the trading plan, let’s identify the candlestick formations that are required at the levels of support and resistance. The only candlestick formations that are used in this
trading strategy are: •
Doji Bar – signals an immediate reversal
•
3 Bar Reversal – signals that the next few bars should go in the opposite direction. If the 3 bar reversal was off a high, then few price bars should go down for the next few bars. If the 3 bar reversal was off a low, then the next few price bars should go up.
•
Engulng Bar – signals that the next few bars should go in the opposite direction.
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If the Engulng bar forms a low and closes up, then the next few bars should go up. If the Engulng bar forms a high and closes down, then the next few bars should go down. All three of these candlestick formations are considered to be price pivot points, so they work very well with the Daily Pivots for support and resistance. •
Doji bar
Doji Bar – must make a new high or low
•
3 Bar Reversal – A three bar reversal is formed when the center bar is either
higher or lower than the bar before it and after it.
3 Bar Reversal – Upward movement anticipation
3 Bar Reversal – Downward movement anticipated
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•
Engulfng Bar – Requires two bars and is formed when the 2nd bar exceeds both
the high and low of the previous bar.
Engulng Bar – Upward Movement anticipated
Engulng Bar – Downward movement anticipated
The trading plan for the Pivoting into Prots is simple. •
Price must be at an area of support or resistance (pivot line, support line, or resistance line)
•
Look for signs that the area will either support price (anticipate upward movement) or resist price (anticipate downward movement) ○ One of the three candlestick formations occur indicating that the pivot lines are working as support (line is below price) or resistance (line is above price)
■ Doji
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■ 3 Bar Reversal ■ Engulng bar •
Entry is one strike price away from the binary’s current price
•
Anticipation is that price will go to the next level of support or resistance. Since you are entering at one strike price out, your risk to reward is a minimum of 1:1 and sometimes greater.
•
If there are high volatility market reports scheduled, wait until after the reports are released before entering a trade using this strategy.
For example, the EURUSD 15 minute chart showed that price was consolidating around the pivot line on Tuesday, August 25th. Then at Point A, a 3 bar reversal is formed as the center bar is higher than the bar before and after (Point A). The prior day’s resistance line is also acting as resistance (Point B). Anticipation is that price will test the 1.1520 area, which is the next area of support. Price is trading at 1.1560 so I enter with ten contracts one strike price out at 1.1540, expiration at 7am New York time, with a risk of $36.25 per contract or $362.50 trading ten contracts.
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Price then breaks down through the pivot area (Point A) reaching the support line (Point B). Price retraces to test the pivot line again (Point A) to ensure that the pivot act will serve as resistance, in essence pushing price down again (typical price behavior because when support is broken, they will retest the area to ensure it is acting as resistance). Price expires less than 1.1540 as anticipated resulting in a prot of $63.75 per contract or $637.50 trading ten contracts (exchange fees not included). The trade resulted in a 174.69 return on investment or a risk to reward of 1:1.75.
Then on Monday morning the Japan 225 chart showed that price was at a pivot line and a 3 bar reversal to the downside formed. I entered a short binary position at the 18850 strike price with ten contracts risking $37.25 per contract or $372.50. Price moved in my favor and expired below the 18850 strike price as anticipated resulting in a gain of $62.75 per contract or $627.50 trading ten contracts.
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That’s all there is to this trading strategy. Candlesticks, support and resistance have been used for many years in trading futures and forex. This trading strategy simply takes the
same approach that we use when trading futures and forex markets and applies it to trading the binary options.
The Movie Click Here for a complete explanation on how to improve your trading using candlestick
formations and key pivot points with this strategy.
Special Offer The Pivoting into Prots is also one of the trading strategies that I use for my Binary Trading Signals Subscription service, which is only $99 per month. I do a webinar each Sunday advising clients where to nd the signals and then send out emails for upcoming trade setups. To subscribe to this special offer, click here.
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ABOUT THE AUTHOR Gail Mercer, is a highly respected trader, trainer, author, and speaker residing in North Carolina. She has over 15 years of experience in trading and in the development of custom indicators. She is a successful author and has
published two ebooks and is also a contributor to Stocks & Commodities and Benzinga.com. She has been recognized as an authority on Volume Analysis and has been asked to speak at the Traders Expo, Traders World, Wyckoff Conference, and Tradestation User Groups. Gail is also the founder and CEO of TradersHelpDesk, and is dedicated to helping traders achieve success. Her unique methodology is rooted in her philosophy that success depends not on a trader’s indicators but the ability to remain focused and responsive to price. Self-
responsibility, another cornerstone of her work, provides the mirror for what a trader needs to learn about him- or herself in relationship to the markets. Working with both the inner and outer aspects of trading, Gail provides an integrated and holistic blueprint for prospering in the markets.
To read Gail’s published articles in Stocks & Commodities, Benzinga, Trading Charts, and TradesWorld, click here.
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Trading 5-Minute Binaries with the Sharpshooter System By Darrell Martin, Apex Investing Institute
The Sharpshooter System is a new system that is working extremely well for ve-minute binaries traded on Nadex at Apex Investing. It is a simple system with only a few easy rules to follow. Part of what makes this system work so well with ATM (At The Money) binaries is because it waits for a pullback. This is the reason the rules say to put in a working order. If your order is picked up, that is great. If it does not, you just delete it. You were probably kept out of a bad trade.
The Sharpshooter System has been proven to work on ve-minute binaries. You can trade it on AUD/USD, EUR/USD, GBP/USD AND USD/JPY all at the same time. This gives you four markets offering trades that expire every ve minutes, (excluding the top of the hour), which is 11 trades per hour per market for the total of 44 trading opportunities per hour! Using the new Nadex Binary Scanner available at Apex Investing Institute, you can watch all four markets at the same time with no switching between screens. You can also utilize the scanner’s tear off function and set the strikes for each market right below each of the charts for added convenience. With the scanner, you will never need to refresh to see the markets you are trading again.
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The images above are examples of using the tear off tickets with ve-minute binary charts and the Sharpshooter System.
The rules are simple:
Sell: 1. Trend ip is red. 2. Trend band is red (top band and ll color) 3. The Trend conrm must be solid red.
4. Volume MUST be exceeding. 5. As soon as the setup bar closes, enter a working order for around $50 risk at the
high of the setup bar. (This will get you in on a retrace if there is one and keep you out if there is not.).
6. If the working order is executed into an open position, you can set a take prot at around $10 to make approximately $40. 7. If the working order is not lled by the start of the last bar of the 5 minutes, cancel it. No trades should be taken on the last bar of the expiry.
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Buy: 1. Trend ip is green. 2. Trend band is green (top band and ll color). 3. The Trend conrm must be solid green.
4. Volume MUST be exceeding. 5. As soon as the setup bar closes, enter a working order for around $50 risk at the
low of the setup bar. (This will get you in on a retrace if there is one and keep you out if there is not.)
6. If the working order is executed into an open position, set a take prot at $90 to make approximately $40. 7. If the working order is not lled by the start of the last bar of the 5 minutes, cancel it. No trades should be taken on the last bar of the expiry.
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One note of caution: If a trend band is collapsing, that may be an indication of a possible reversal. Trend Band, Trend Flip, Trend Confrm. All of these phrases may sound like a foreign
language to you if you are not familiar with the indicators used at Apex Investing. The new Nadex Scanners for both Binary Options and Spreads are powerful components that not only help with the Sharpshooter System but also can help you with all of your trading. They are available free at Apex. The speed alone will amaze you, but the binary scanner is essential for trading ve-minute binaries.
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The image below shows a screenshot of the Nadex Binary Scanner.
As you can see, there are settings that allow you to see only what pertains to what you want to buy or sell. You can tell it to nd only ve-minute ATM AUD/USD strikes, if that is what you want. You can click an icon that will pull up a Nadex order ticket where you can set it for the price or the strike level that you would like your order to be lled. If it is a working order, and you are following the rules as stated above, if the market hits your specications, your order will get lled. If it does not get lled, you would cancel your order by the last minute of the veminute trading time. If it does get lled, you would then set your take prot as dened in the rules above. You are able to do all of this on the scanner making trading quick and easy.
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No jumping back and forth between screens! When you are trading ve-minute binaries, no one has time to jump back and forth! You will waste time and may miss some good trades. As stated in the rules, you want to buy/sell as close as you can get to $50, setting your take prot so that you make around $40. The $50 denes your risk. On a day when the markets are ranging, you may want to consider a smaller take prot. As with any new-to-you strategy or system, try it out in Demo rst. Make sure you understand how it works with funny money before you risk your real money.
The Movie A recent Apex Investing webinar explains the Sharpshooter System in full detail. It can be viewed in its entirety, simply CLICK HERE.
Special Offer: Free Scanner with immediate submit Free Education Free Deviation Levels
Two-Week Trial for only $7 on Sharpshooter with access to Spread and Binary options,
Futures and Forex Trading Rooms. Check it out at www.apexinvesting.com
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About the Author Darrell Martin coined the phrase “Diagnostic Trading.” He denes “Diagnostic Trading” as looking at how fundamental, technical, statistical, and seasonal traders look at the market and then using that knowledge to help more accurately establish a trading plan. Darrell is the host of his daily radio show “The Diagnostic Trading Hour” and a cohost of the “Bull/Bear Binary Hour” with Steve Rhodes and Tommy O’Brien. He also conducts webinar and live training courses on futures, forex, options, equities, Nadex binaries and Nadex Spreads. He is an ofcial educational partner of the Nadex CFTC regulated exchange in Chicago.
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The 80% Rule Applied to Binary Options By Sean Jantz, Binary Trade Group
If I was forced to only use one indicator it would be hands down the free Market Prole tool. Using Market Prole on Futures, you’ll be able to draw a Value Area which is a very powerful tool for support, resistance and trend analysis. Having the Value Area drawn on your chart, you can take one second to analyze the chart and know is bearish, bullish, trending, overbought, oversold or in ‘fair value’.
Value Area: The Value Area represents the range of prices that contain 70% of a day’s
trading activity. This 70% represents one standard deviation and reects the area where a majority of the trading occurred. It is most commonly referenced to yesterday’s trading and used as reference points for the current day. Make sure to click on the video at the end of this chapter to see how you can set up the Value Area on your charts. There are several ways to prot from the Value Area ‘box’ on your chart and in this chapter I’m going to cover the most lucrative way, the 80% Rule. The 80% Rule is best explained visually. Basically, you can see in the pictures, if price comes outside of the Value Area box and comes back inside for at least 30 minutes to 1 hour, then there is an 80% chance that price will ll the box to the downside or to the upside.
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I know what you might be thinking and I get this asked a lot, - “It can’t be this easy, right??” I thought the same thing when I rst started trading with Value Area, but now I’m a believer of this system and no other pattern or ‘system’ has made more money than this Rule. It doesn’t happen every day, it happens roughly 3/10 days on the /ES (S&P 500 Futures) and when it does setup, you can make your entire week or even monthly prot on just one trade. Let’s see how this plays out in the markets on September 2, 2015:
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The emini S&P 500 futures (/ES) climbed above and through Value Area High just before the Opening Bell. At 9:30, the market reversed and broke back into the Value Area Box. If you were convinced the 80% rule would come into play, there are 3 options you could consider:
1. An In-the-Money (ITM) SELL at around 1940. Your risk might be $75 to make $25 on this high probability trade.
2. An At-the-Money (ATM) SELL at around 1932. You would risk $50 to make $50. 3. An Out-of-the-Money (OTM) SELL at around 1920, risking $25 to make $75. If you chose an 11:00am expiry, the rst two trades would have expired in the money for full prot. The OTM trade would not have expired in the money, but you would have had ample opportunity to take prot before expiry. Every evening, I setup the Value Area for the next trading day on the S&P 500 Futures, Russell 2000 Futures, Gold Futures and Crude Oil Futures and I share my ThinkorSwim workspace with members of the Binary Trade Group members so they can load have it ready for the next trading day.
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I also do nightly Trade Plan videos doing in depth analysis on the Indices Futures so myself
and anybody who wants to trade with me never goes into a trading morning in the dark. When you start your trading day, your ThinkorSwim charts are populated with the day’s Value Area Box, along with key support and resistance areas. You can also watch the battle plan to get my take on the markets before the Opening Bell.
The Movie In this video, you will learn about the Value Area and the 80% Rule. You will learn how to set it up and how to use the Value Area to make trading decisions. Click Here for the video. Here’s the training on the 80% Rule in more depth with live examples and examples from Sean Jantz’s nightly trade plans. Trade with the Value Area on your charts for 3 months and you’ll never trade without it again. Want to learn more? Here’s a quick tutorial about Binary Trade Group and what we do and what we offer. We offer extensive NADEX education and strategies all for free.
Special Offer Spend 14 Days with the Binary Trade Group and nd out if it’s right for you. You will have access to our Private Facebook Room, and will be able to access our trading plan and the tools described above. Just visit www.binarytradegroup.com to get started.
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About the Author Sean Jantz, the Founder of Binary Trade Group, is a fairly new, successful trader who saw the need for more simplication in the marketplace for ordinary people trying to bust through into the markets. Sean’s journey to protability was lled with courses, books and videos that sounded great, but nothing seemed to make sense, or he just didn’t understand how to apply the teachings. Now, he has a knack for simplifying charts and terminology by using layman terms and using real world analogies so newer traders can keep up. He likes to say, “If you can’t explain it to a 3rd grader, then you can’t explain it.”
Binary Trade Group is all about traders helping traders. Trading alongside others and learning from protable NADEX traders dramatically speeds up the learning curve. BTG aims to keep NADEX simple but effective. Take a FREE sneak peek at BTG and visit www. binarytradegroup.com!
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Open a Free Nadex Demo Account and Get the Most out of this Book!
It’s as Easy as 1-2-3! 1. Go to the Nadex Demo Page 2. Create a unique demo user name 3. Fill in your name, telephone number and email address That’s it! You will have access to a free 2-week Nadex demo platform funded with $25,000 in play money. Use your Nadex demo account to test your favorite strategies in this book.
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Using Bollinger Bands to Trade Binary Options By Tradën Group
Bollinger Bands are a technical indicator used to measure the volatility of any market. They
consist of a center moving average and two price channels above and below that are referred to as the bands.
When there is little or no movement in the markets, the bands narrow. When there’s a lot of movement in the market, the bands broaden. You can also get an idea of the strength
of the market by the degree of the incline or decline of these expansions. Quite often, the market will bounce off the Bollinger Bands, touching the top band and moving back toward the bottom band.
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The bands act as dynamic support and resistance. Traditional support and resistance
levels are plotted by horizontal lines. Dynamic support and resistance levels are constantly changing depending on price action. Many traders play the prices being rejected off the bands as Bollinger Bounce plays.
When Bollinger Bands squeeze together, it can signal accumulation and communicate an imminent breakout to the upside or to the downside. If a breakout occurs, traders can get a sense of an extreme market condition by observing how high or low the market travels on the breakout. The further it climbs away from the center moving average, the more likely it will snap back. Bollinger Bands are best used in conjunction with other indicators and patterns. Now let’s take a look at a recent trade setup with Bollinger Bands and the MACD on the GBP/USD:
On this 15-minute chart, you can see how the market bounced off the upper, lower and middle bands. At 6:00 in the morning, the GBP/USD bounced off the bottom band, followed by a bullish MACD crossover. At that moment, you have a few of trading possibilities: 1. In the Money (ITM) BUY at 1.5260, risking probably $70 to make $30, or 2. At the Money (ATM) BUY at 1.5280, risking $50 to make $50 3. Out of the Money (OTM) BUY at 1.5300, risking possibly $30 to make $70
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If you chose a 3pm expiry, all three of those trades would have settled in the money for full prot. Bollinger Bands can be a very useful tool for make decisions when it comes to trading binary options. They are one of the many indicators we provide education on at Tradën Group.
The Movie Make sure to watch this short presentation on using Bollinger Bands to trade binary options. Click Here for the video.
Special Offer Traden Group is unveiling a brand new website with expanded services to its members. Visit www.tradengroup.com to view all of the services included in your subscription. Use promo code TGPRO2016 to get a 15% discount off your monthly subscription price.
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About Tradën Group Tradën offers an online social platform which also invites traders both new and professional. Connecting traders with other traders, whether new or professional everyone has the chance to earn an income from anywhere in the world. The social platform will allow traders to have their own story on a certain topic within the day trading industry, people can follow other traders and see all of that and also what recent protable trades they’ve taken. Offering an abundance of education for NADEX and Forex to ensure everyone has access to fundamental information and successful strategies, as long as they are willing to put in the time commitment to actually learn and implement their plan for success.
Stefan Katanic - Prior to Tradën he was a talented investment advisor with exceptional understanding of nancial investing and demonstrated track record developing protable relationships with high-net worth individuals and a passion for entrepreneurship. Zachary Hogan – Passionate about entrepreneurship and understanding innovative ways to view and expand upon ideas, realizing the importance of clarication and considering all possible outcomes for the best user experience through integrating technology.
Eddie Viteri – Passionate about the nancial markets and creating simple and effective methods, integrating trading into lifestyle since 2009 – thoroughly testing and studying advanced yet unique ways to prot regardless of the style of trading.
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Trading High Impact News with Inverse Currency Pairs By Khari Lane, Wildcat Investment Strategies
On the rst Friday of every month, the Nonfarm Payroll reports are released at 8:30am EDT. The report measures the change in employment during the previous month, excluding the farming industry. If the reports signicantly miss analyst’s estimates to the upside or downside, it can have a dramatic impact on the markets. One way to trade in advance of the NFP reports is with Inverse Currency Pairs. With Inverse currency pairs, you are making two out-of-the-money (OTM) trades. One trade has a currency in the numerator of the currency pair. The next trade has the same currency in the
denominator. Here’s an example: USD/JPY - The USD is the numerator GBP/USD - The USD is the denominator If news is bullish for the USD, the USD/JPY is likely to be bullish, while the GBP/USD will be bearish. It news is bearish for the US Dollar, then the USD/JPY will likely be bearish, and the GBP/USD will be bullish. These two currency pairs were selected to be traded in advance of the Nonfarm Payroll Reports (NFP) on Friday, September 4, 2015. Since the news can’t be known in advance, the decision was made to SELL both pairs with OTM binary options trades risking no more than $20 per trade, on average. The following trades were placed at 8:21, just before the release of the reports:
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For this trade to be successful, one trade would have to win and the other trade would have to lose.
When the reports were released at 8:30 am, the news was BULLISH for the US Dollar. The USD/JPY rose rapidly, while the GBP/USD tanked. Since I had SELL orders on both pairs, the market worked in favor of the GBP/USD trade and against the USD/JPY trade. Here’s how the GBP/USD trade played out:
The market dove sharply, then ground its way past the OTM strike price expiring for a full prot of $79.25 at the 11:00am expiry (exchange fees not included). For the GBP/USD to win, the USD/JPY had to lose, and it did:
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The end result was a $61.49 prot on $38.50 risked (exchange fees not included). Inverse currency pairs are one way to look at trading major news events, especially if a traditional strangle doesn’t give you the risk/reward you are looking for. The worst case scenario? The market doesn’t react to the economic news at all. In that event you may wish to consider exiting your positions to minimize losses, if possible.
The Movie Click Here to watch Khari Lane explain how inverse currency pairs work.
Special Offer •
At the time of this publication, Khari is launching a new website, with new services and products that will be offered. Visit www.wildcatinvesting.com for updates.
•
Join the Wildcat Investment Strategies Facebook Group for strategies and updates.
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About This Author Khari Lane is the CEO and founder of Wildcat Investment Strategies LLC. At Wildcat, we are dedicated to helping ordinary people learn how to trade and developing existing traders into professionals. We focus on teaching
the NADEX platform to help grow and expand the platform. We want to help bring NADEX to everyone as it allows everyone to be more versatile and potentially make a lot of capital with proper knowledge and dedication to trading. We look forward to teaching you more methods on how to become a protable trader.
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An Afternoon Trade with the GBP/USD and EUR/USD By Krystal Comber, SlickTrade.net
The “Afternoon Delight” trade has been extensively tested on the GBP/USD and EUR/USD currency pairs, and it is very consistent and super simple to execute if a setup is in play.
The trade requires two components: •
15 minute charts on the GBP/USD
•
MACD
If you see a crossover after 12:00pm EDT, a trade setup is in play. It really doesn’t get much simpler. For full details on this strategy, make sure to watch Krystal’s short video at the bottom of this blog.
Here are the steps you need to take to execute the GBP/USD “Afternoon Delight” trade.
•
Select the 7pm daily on the Nadex platform.
•
Look to see the overall trend direction from the start of the New York Session.
•
If it was bearish (downward movement) then you will be looking to Buy after you receive conrmation of trend direction change.
•
If the trend was bullish (upward movement) then you will be looking to Sell after you receive conrmation of trend direction change.
•
If there is any news on GBP or USD during the hours of 12pm – 7:15pm (EST) – avoid trading the strategy that day.
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•
Once the cross occurs on the MACD, wait for full formation of the current 15 minute candle.
•
If the trend direction was bearish, then you would purchase a Buy at the lowest point of the body of the candle where the cross occurred.
•
If the trend direction was bullish, then you would purchase a Sell at the highest point of the body of the candle where the cross occurred.
•
I normally place a market order and a working order on this strategy. Many times the strike gets tested for the next few hours, so setting a working order in addition to the market order can give you additional prot possibilities overall.
•
That’s it!
“Afternoon Delight” Trade - Thursday, July 16 2015
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On this 15-minute Nadex chart, the MACD crossover occurred at 3:15pm EDT. The market then moved below the T-Line (8EMA, shown in purple) and started to grind its way down. The decision was made to SELL the GBP/USD from 1.5620, which was a position of safety. Since the probabilities were high that this trade would be successful, I risked $72.72 to make $27.25. The trade was never threatened. I’ve been trading this strategy for several months, and I have been rarely disappointed, so I wasn’t too worried. It is important to note that if the market suddenly decided to reverse and attack my position, it
would be very wise to bail out and cut losses. But that wasn’t the case yesterday. As it usually does, the market just continued to drift downward, and this trade was never threatened. Trade Results:
Win: SELL at >1.5620 - 1 contract x $27.25 prot, less $1.80 in exchange fees = $25.45
“Afternoon Delight” Trade - Friday, July 17, 2015
The rules for this strategy are slightly modied on Friday, since Nadex does not offer a 7pm expiration on Friday. Today, I was looking for a MACD crossover sometime after 11pm. The crossover occurred at 1:30pm and I pulled the trigger on a trade risking a maximum of $60 to make a maximum of $40 dollars. The trade was briey threatened, but it settled safely in the money for a full prot.
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Conclusion This strategy is very consistent. To back-test it, just load the 15-minute charts and the MACD. Look at the time period after 12noon and look for a MACD crossover. If it happens, look at where the GBP/USD price is at 7pm. Test this strategy in demo before you attempt trading it live to see if it suits your trading style.
The Movie Click Here to watch Krystal Comber explain the “Afternoon Delight” Strategy on the GBP/
USD.
Special Offer •
Open Up a 2-Week Free Nadex Demo Account – Sign up for a free Nadex demo
account. It will be funded with $25,000 in play money. Test these strategies and see how they work out for you. •
Get a 15% Lifetime Discount on the Sapphire Membership Offered from SlickTrade.net – Coupon Code TRADINGPUB – Only good for non-existing
members to the SlickTrade Academy – Code expires November 1, 2015.
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About This Author Krystal Comber – CEO of SlickTrade Online Trading Academy Krystal
had a vision to create a community of online traders and afliate marketers, where everyone involved could make an income. With years of extensive knowledge in both, the combination of the two seemed to make for one amazing opportunity for growth. Krystal spent months perfecting her strategies and creating the foundation
of SlickTrade. Her ambition to create a business where individuals could make an income in the trading industry whether new or experienced or through the afliate program with $0 to invest, has created an entirely new way to create nancial freedom.
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Trading Crude Oil and Natural Gas News with Binary Options By Cam White, TradingPub
Trading into news always involves risk, but if you have a good strategy, it can also be very protable. In this chapter strategies will be discussed for trading weekly inventory reports for Crude Oil and Natural Gas.
Crude Oil Every Wednesday, Crude Oil inventory reports are released at 10:30am EDT by the Energy Information Administration (EIA). The report measures the change in barrels of crude oil held by US companies. It’s not uncommon for the actual inventory reports to greatly miss the forecast projections from the analysts. When that happens, there can be wild swings in the price of crude oil. With binary options, you are making a decision about the likely direction of the market
relative to a strike price within a dened time period. If the price of the asset you are trading agrees with your opinion at expiry, the trade settles for $100 per contract. If it doesn’t, the payout is $0. You can always exit a position early if you want to take a partial prot, or to minimize losses if the trade is moving against you. One strategy for trading crude oil inventory news is to place an OTM binary option trade on either side of the underlying indicative price before the release of the news. Here’s an example of how this strategy was used on Wednesday, July 29, 2015:
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Before the 10:30 crude oil inventory reports were released, the market was traveling sideways, straddling the 47.62 strike price. The following strategy was used: •
The 9:00-11:00am time frame for Crude Oil was selected for for this trade
•
At 10:16am, two OTM trades were placed on either side of the underling price of the market: ○ BUY Crude Oil at >48.42. Maximum risk $19.50, maximum Reward $80.50 ○ SELL Crude Oil at >46.82 Maximum risk, $20.75. Maximum reward $79.25
For this trade to be successful, one trade needs to expire in the money, and the other trade
takes a loss. The maximum risk on the losing trade is subtracted from the reward earned on the successful trade.
The worst case scenario in this strategy is if the market doesn’t react to the news, and continues to trade sideways. In that event, you may wish to exit both trades to minimize losses, if possible.
At 10:30am the Crude Oil Inventory Report was released, badly missing estimates by over
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4 million barrels. In an instant, the market shot straight up, making the BUY order good. It continued to climb all the way to the 11:00am expiration. The SELL order expired for a full loss. The net prot from this trade was $59.75 (exchange fees not included).
Natural Gas Every Thursday at 10:30am EDT, The Energy Information Administration (EIA) releases the Natural Gas Storage Report, which measures the change in the number of cubic feet of natural gas held in underground storage during the past week. If the actual report misses estimates signicantly, it can instantly result in result in large upward or downward moves in the price of Natural Gas Futures contracts. The question then becomes “Which way will the market move on the news?” Will it spike up, dive down or trade sideways? You could decide to sit on the sidelines and wait for the market to digest the news when it is released. You could decide to place a trade in advance of the news. You could also choose not to trade Natural Gas on a news day. Let’s assume you believe that the Natural Gas Storage Report will miss estimates, resulting in a possibly signicant price move on the news. Since there is no way to know what the news will be, you could decide to hedge your trade in advance of the news with two out-ofthe money (OTM) trades. When you place an OTM trade, you risk less money for a greater reward, since you are at a disadvantage relative to the current price of the market. Let’s take a look at an OTM trade on the Natural Gas Storage report released on Thursday, August 13 2015. The Natural Gas market traveled sideways at around 2.91 going into the 10:30 news release. At 10:21, just prior to the release of the news, two OTM trades were placed on either side of the market, with an 11:00am EDT expiry:
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If the market moves signicantly in one direction other, one contract becomes more valuable, while the opposing contract becomes less valuable. If one contract expires in-the-money for a full prot, the other will expire out-of-the money for a loss. One trade acts as a hedge against the other trade. The worst case scenario is that the market doesn’t react to the news and trades sideways. In that event, the maximum loss you can incur in this example is $36.25 (exchange fees not included). Here’s how this OTM strategy played out.
When the 10:30 Natural Gas Storage Report was released, it missed estimates signicantly. Within ve minutes, the market dove all of the way through the SELL strike price at >2.870 to around 2.850. Two opportunities now presented themselves: 1. Exit the trade early and take prot, or 2. Let the trade continue for the remaining half hour and see if it expires at or below 2.870 for a full prot, bearing in mind that if the market expires above 2.870, the payout is $0. The trade expired at 2.8456, allowing the SELL contract at >2.870 to expire in-the-money for a maximum reward of $86 per contract. The BUY contract settled out-of-the money for a payout of $0, resulting in a loss of the $20.25 risked on that trade. This resulted in a $65.75 prot (exchange fees not included).
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There are many strategies for trading the news, but an OTM binary options strategy gives you the opportunity to prot from large moves in the market without exposing yourself to excessive risk.
Special Offer •
Open Up a 2-Week Free Nadex Demo Account – Sign up for a free Nadex demo
account. It will be funded with $25,000 in play money. Test these strategies and see how they work out for you. •
Get a Free Library of Nadex Information – Courtesy of TradingPub
About The Author Cam White is a Partner Relationship Manager with TradingPub. When he joined TradingPub in June 2014, his rst assignment was to become familiar with Nadex. He downloaded the demo software and dove into the Nadex platform. A self-professed “crash test dummy”, Cam tests directional and non-directional strategies with Nadex Binary Options and Nadex spreads and publishes results.
Cam also publishes The Probability Report, a monthly newsletter featuring Nadex webinars, and contributes articles on Nadex to nancial media outlets.
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A Full Day of Trading Opportunities with Controlling Candlesticks By Cam White, TradingPub TradingPub
As an active Nadex trader, trader, I look for patterns that repeat themselves with a high degree of consistency. consistency. If a pattern repeats itself on a daily basis better than 80 percent of the time, it’s a pattern worth following and trading. Over the past year, year, I have identied the same pattern that occurs in four different Indices at different times of the day. day. Here’s the schedule: 7:00am – 9:00am EDT: EDT:
The Germany 30 (DAX) “Strudel” “Strudel ” Strategy
9:00am – 11:00am EDT: EDT:
The FTSE 100 “Brunch” Strategy
11:00am - 1:00pm EDT: EDT:
S&P 500 “Pastrami” “Pastr ami” Strategy
1:00pm – 7:00pm EDT: EDT:
The GBP/USD or EUR/USD “Afternoon “After noon Delight” Strategy
8:00pm – 10:00pm EDT: EDT:
Japan 225 (Nikkei) (Nikkei ) “Kanpai” Strategy
7:00am – 9:00am EDT: The Germany 30 (DAX) “Strudel” Strategy Trading Trading the Germany 30 Index (DAX) futures with Nadex binary options can help build trading consistency. Tom Busby, a veteran trading educator once observed that the 7:00 am EDT hourly candlestick of the German DAX market is a pivotal point that inuences the following hour of trading. If you take a look at the hourly charts of the DAX, you will notice that this observation is correct a great majority of the time. This observation led to the development development and testing of a strategy for trading t rading the Germany 30 (DAX) market in Nadex using their 7am-9am trading time frame. The rules are very simple to follow, and it doesn’t require extensive training to master this strategy. A very tasty breakfast trade.
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Rules for Trading the 7-9 am EDT Germany 30 “Strudel” Strategy with Nadex Binary Options 1. Locate the Germany 30 Index on the Nadex Finder, and select the 7am-9am time frame.
2. Take a look at the daily, hourly, 30-minute and smaller time frames for the DAX. Is the market in an uptrend, downtrend, or is it chopping sideways? 3. Take a look at the Volatilit Volatility y Index (VIX). (VIX) . This strategy works wor ks best if the VIX is under
20. It is less reliable when the VIX is above 20, since markets can become very whippy and unpredictable. The DAX also has a tendency to track with the S&P 500, so I keep that market open as a conrming market. 4. What do your your favorite indicators indicators tell you about the direction of the market? 5. Take a look at the economic calendar. Is there any overnight economic news
driving the direction of the DAX? Are there any US economic or earnings reports due to be released before 9:00 am EST? Trading into economic news reports can be very risky.
6. Record the opening opening price of the 7:00 am hourly hourly bar. bar. Also record the rst Nadex strike price available above and below the opening price. 7. Watch the hourly candlestick develop. This can take patience, but you are looking for conrmation of a bullish or bearish hourly candlestick. In some cases, it can take almost an hour for conrmation. 1. Once you are convinced convinced the 7am hourly hourly candlestick will close BULLISH, then BUY from the rst strike price BELOW the 7am opening price.
2. Once you are convinced convinced the 7am 7am hourly candlestick will will close BEARISH, then SELL from the rst strike price ABOVE the 7am opening price.
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8. You can place a market order, yielding a lesser prot and greater risk, or you can amend your order, to get a better risk reward. 9. That’s all there is to it. If your order lls, then you just wait until the contract expires
at 9:00 am. If your positions are threatened, you can always exit early and preserve some prots or minimize losses. 10. If the market is moving with momentum, I also consider an OTM strike price, yielding a much better risk/reward (see chart below)
The 7-9am Germany 30 (DAX) “Strudel” “Strudel” Strategy for August 11, 2015
In this example, the 7am hourly candlestick closed BEARISH, triggering a SELL. The market was on a fairly steep down trend, so a SELL strike price was chosen near the 7am opening price. A Working Order was place with $70 risk. The only way that order lls is if there is a brief upward retracement in the market. At the same time, an OTM SELL order was placed well below the market with a maximum risk of $8, for a maximum reward of $92. The Working Order didn’t ll, and I opted to exit early and take $31 prot on the OTM trade. That trade ultimately settled in the money for what would have been a $92 prot (exchange fees not included).
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The 9:00am - 11:00am FTSE 100 “Brunch” Strategy This strategy is identical to the strategy above, just with a different Index in a different time frame.
Rules for Trading the 9-11 am EDT FTSE 100 Strategy with Nadex Binary Options 3. Locate the FTSE 100 Index on the Nadex Finder, and select the 9am-11am time frame.
4. Take a look at the daily, hourly, 30-minute and smaller time frames for the FTSE 100. Is the market in an uptrend, downtrend, or is it chopping sideways? 5. What do your favorite indicators tell you about the direction of the market?
6. Take a look at the Volatility Index (VIX). This strategy works best if the VIX is under 20. It is less reliable when the VIX is above 20, since markets can become very whippy and unpredictable. The FTSE 100 also has a tendency to track with the S&P 500, so I keep that market open as a conrming market. 7. Take a look at the economic calendar. Is there any economic news driving the direction of the FTSE 100? Are there any US economic or earnings reports due to be released before 11:00 am EST? Trading into economic news reports can be very risky.
8. Record the opening price of the 9:00 am hourly bar. Also record the rst Nadex strike price available above and below the opening price. 9. Watch the hourly candlestick develop. This can take patience, but you are looking
for conrmation of a bullish or bearish hourly candlestick. In some cases, it can take almost an hour for conrmation. 10. Once you are convinced the 9am hourly candlestick will close BULLISH, then BUY from the rst strike price BELOW the 9am opening price.
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11. Once you are convinced the 9am hourly candlestick will close BEARISH, then SELL from the rst strike price ABOVE the 9am opening price.
12. You can place a market order, yielding a lesser prot and greater risk, or you can amend your order, to get a better risk reward. 13. That’s all there is to it. If your order lls, then you just wait until the contract expires at 11:00 am. If your positions are threatened, you can always exit early and preserve some prots or minimize losses. 14. If the market is moving with momentum, I also consider an OTM strike price, yielding a much better risk/reward.
The 9-11am FTSE 100 “Brunch” Strategy for July 9, 2015
In this example, the rst hour was bullish, triggering a BUY at 6629, the rst strike price below the 9am opening price. The trade was threatened during the rst 30minutes of the following hour, but ultimately settled in the money for a full prot.
The 11:00am – 1:00pm S&P 500 “Pastrami” Strategy When I think of lunch on Wall Street, I think of a Pastrami on Rye at a New York delicatessen. This strategy is identical to the strategies above, just with a different Index in a different time frame.
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Rules for Trading the 11am-1pm “Pastrami” Strategy with Nadex Binary Options 1. Locate the US 500 Index on the Nadex Finder, and select the 11am-1pm time frame.
2. Take a look at the daily, hourly, 30-minute and smaller time frames for the US 500. Is the market in an uptrend, downtrend, or is it chopping sideways? 3. What do your favorite indicators tell you about the direction of the market?
4. Take a look at the Volatility Index (VIX). This strategy works best if the VIX is under 20. It is less reliable when the VIX is above 20, since markets can become very whippy and unpredictable. 5. Take a look at the economic calendar. Is there any economic news driving the
direction of the S&P 500? Are there any US economic or earnings reports due to be released before 1:00 pm EDT? Trading into economic news reports can be very risky.
6. Record the opening price of the 11:00 am hourly bar. Also record the rst Nadex strike price available above and below the opening price. 7. Watch the hourly candlestick develop. This can take patience, but you are looking for conrmation of a bullish or bearish hourly candlestick. In some cases, it can take almost an hour for conrmation. 15. Once you are convinced the 11am hourly candlestick will close BULLISH, then BUY from the rst strike price BELOW the 11am opening price.
16. Once you are convinced the 11am hourly candlestick will close BEARISH, then SELL from the rst strike price ABOVE the 11am opening price.
8. You can place a market order, yielding a lesser prot and greater risk, or you can amend your order, to get a better risk reward.
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9. That’s all there is to it. If your order lls, then you just wait until the contract expires
at 1:00pm. If your positions are threatened, you can always exit early and preserve some prots or minimize losses. 10. If the market is moving with momentum, I also consider an OTM strike price, yielding a much better risk/reward.
The 11am-1pm US 500 “Pastrami” Strategy for July 31, 2015
In this example, the 11:00am hourly candlestick closed bearish after a strong bullish 10am candlestick. Following the rules, I took 2 SELL orders above the 11am hourly opening price. The market continued moving downward, making both trades good.
1:00pm – 7:00pm The “Afternoon Delight” Trade on the GBP/USD or EUR/USD This strategy by Krystal Comber is covered in a previous chapter, but I follow it daily to see if there is a setup. Most of the time, I can nd a MACD crossover on the 15 minute charts, setting up a trade.
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This trade is easy to spot. Just make sure you have 15 minute charts open on the GBP/USD and the EUR/USD. If I see a MACD crossover happen after 1pm, I take the trade with a 7pm expiry.
The 8:00pm – 10:00pm Japan 225 (Nikkei) “Kanpai” Strategy “Kanpai” means “Cheers” in Japanese, and this strategy can be a nice way to end the day.This strategy is identical to the DAX, FTSE and S&P 500 strategies above, just with a different Index in a different time frame.
Rules for Trading the 8-10pm Japan 225 “Kanpai” Strategy with Nadex Binary Options 1. Locate the Japan 225 Index on the Nadex Finder, and select the 8pm-10pm time frame.
2. Take a look at the daily, hourly, 30-minute and smaller time frames for the Japan 225. Is the market in an uptrend, downtrend, or is it chopping sideways? 3. What do your favorite indicators tell you about the direction of the market?
4. Take a look at the Volatility Index (VIX). This strategy works best if the VIX is under
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20. It is less reliable when the VIX is above 20, since markets can become very whippy and unpredictable. The Japan 225 also has a tendency to track with the S&P 500 futures, so I keep that market open as a conrming market. 5. Take a look at the economic calendar. Is there any economic news driving the
direction of the Japan 225? Are there any economic or earnings reports due to be released before 10:00pm EST? Trading into economic news reports can be very risky.
6. Record the opening price of the 8:00 pm hourly bar. Also record the rst Nadex strike price available above and below the opening price. 7. Watch the hourly candlestick develop. This can take patience, but you are looking for conrmation of a bullish or bearish hourly candlestick. In some cases, it can take almost an hour for conrmation. 17. Once you are convinced the 8pm hourly candlestick will close BULLISH, then BUY from the rst strike price BELOW the 8pm opening price.
18. Once you are convinced the 8pm hourly candlestick will close BEARISH, then SELL from the rst strike price ABOVE the 8pm opening price.
8. You can place a market order, yielding a lesser prot and greater risk, or you can amend your order, to get a better risk reward. 9. That’s all there is to it. If your order lls, then you just wait until the contract
expires at 10:00pm. If your positions are threatened, you can always exit early and preserve some prots or minimize losses. 10. If the market is moving with momentum, I also consider an OTM strike price, yielding a much better risk/reward.
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The 8-10pm Japan 225 “Kanpai” Strategy for July 1, 2015
This pattern repeats itself with a high degree of frequency. On the hourly chart above, you can see that the 9pm hourly bar doesn’t challenge the 8pm opening price. At the time of this publication there has been considerable upheaval in the Chinese markets, and the VIX has been well over 20. If there is too much volatility in the market, I exercise extreme caution with this trade. Under “normal” market conditions, it tends to behave very well. There you have it. A day full of trading opportunities from 7:00am to 10:00pm. When the markets aren’t experience abnormal volatility, each of these strategies are highly consistent.
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the movie Click Here to watch how Cam White trades these strategies.
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About The Author Cam White is a Partner Relationship Manager with TradingPub. When he joined TradingPub in June 2014, his rst assignment was to become familiar with Nadex. He downloaded the demo software and dove into the Nadex platform. A self-professed “crash test dummy”, Cam tests directional and non-directional strategies with Nadex Binary Options and Nadex spreads and publishes results.
Cam also publishes The Probability Report, a monthly newsletter featuring Nadex webinars, and contributes articles on Nadex to nancial media outlets.
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