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How To Trade Binary Using Railway Track Candlestick Pattern

Candlestick patterns serve as a very good tool to trade binary option as it is a good way to interpret the market.

The candlestick pattern is the upfront showcase of the market condition. Therefore a trader can roughly tell whether the price is going to move up or down temporarily simply with the help of several candlestick patterns.

In this post, I am going to share with you one candlestick pattern that is very effective to tell the reversal of the market.

Railway Track Candlestick

The railway track patterns is made up of one long up candle and one almost equal down candle. It forms something like a chopstick or some people will call it a tweezer.

Railway-Track

This formation is formed when a price hits a major resistance or support which causes traders to enter a trade to trade the repulsion.

Once you see this formation, it is a sign of a coming down move. I am not saying that it will be a major reversal, but it will at least be a retracement.

Therefore for us who are trading binary option, this candlestick serves as an alert to tell that the price is going to move down shortly and what you need to do is to wait for your strategy to issue you a trading opportunity to tell you to enter a trade to go LOW

These candlestick pattern serves as an additional confirmation of our trade as it will increase our chance of winning.

I will continue to share with you guys more candlestick patterns that cater for binary option trading only.

For those of you who are interested to see how I trade, you can take a look at my FREE Live Trading Room where I will allow you to watch over my shoulder to see how I trade everyday and how I setup my chart everyday.

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The Importance of Trend Line In Binary Trading

One of the most important tool in trading is the trend line. The trend line is an invisible line of support and resistance that you must plot in order to identify it.

Knowing the position of strong level of trend line can be a plus point in trading. Sometime if you do not know the position of those strong trend line and you enter a trade against the trend line, you do not even know what hits you when the option expires as a losing trade.

Knowing that there is a strong resistance trend line above the price and your strategy tells you to enter a HIGH option, you should consider whether you should enter the trade or not.

Alternatively, you can enter a trade with a lower trade size for trades that are against the trend line.

So let me share with you how to identify strong trend line

  • First of all, you will need to identify swing highs and swing lows as these are the points where you are going to connect to draw a trend line.

Swings

Swing high

  • Next you will try to connect various swing highs and various swing lows together to form your trend line.

trend line 1

trend line 2

  • The trend line you are going to keep are the ones which have more than 3 connecting points.

Once you have identified all the strong trend line, you can then wait for the price to hit those levels.

All you need to wait for is for your strategy to inform you to enter a trade that is in the direction of the repulsion of the trend line.

I am not asking you guys to enter trade whenever the price hits the trend line as this will wipe your account out in no time.

The trend line serves as an additional tool for the strategy you are using as it will improve your overall performance.

For those of you who are interested to see how I trade, you can take a look at my FREE Live Trading Room where I will allow you to watch over my shoulder to see how I trade everyday and how I setup my chart everyday.

Click Here For My Live Trading Room

 

 

 

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How to trade Binary Using EMA Crossover

The EMA crossover is a good tool for traders to tell the trend of the market. Knowing the trend of the market can be a great help to traders when placing a trade.

So how do you use the EMA crossover to tell the trend

What you can do is to plot a 50 and a 100 exponential moving average on the chart that you trade on.

When the 50 EMA crosses below the 100 EMA, it is telling you that the current trend has now switched to downtrend. What you can do now is to look for opportunity to go LOW.

EMA DOWN CROSS

When the 50 EMA crosses above the 100 EMA, it is telling you that the current trend has now switched to uptrend. What you can do now is to look for opportunity to go HIGH.

EMA UP CROSS

I am not saying that you will enter HIGH trend continuously when you see the 50 EMA crosses above the 100 EMA.

What you should do is to wait for the trading opportunity based on the strategy you are using and then only enter trade that are in the direction of the current trend. It is always better to trend in the direction of the crossover then against it.

For those of you who are interested to see how I trade, you can take a look at my FREE Live Trading Room where I will allow you to watch over my shoulder to see how I trade everyday and how I setup my chart everyday.

Click Here For My Live Trading Room

 

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How to trade Binary Option Using MACD Divergence

The MACD indicator is another great tool you can consider when trading binary option.

One of the easiest way to use the MACD indicator to trade binary option is the divergence. For the usage, you just need to use the default setting of the MACD indicator provided by your broker.

In case some of you do not know what MACD divergence is, so please let me spend sometime to go through what a divergence looks like.

  • MACD Negative Divergence

Negative-Divergence

When the MACD indicator forms a lower high while the price forms a higher high, it is consider a sign of MACD negative divergence.

A MACD negative divergence is a sign that the price is going to move down soon and therefore as a binary trader, you can start to look for opportunity to go LOW.

  • MACD Positive Divergence

Positive-Divergence

When the MACD indicator forms a higher low while the price forms a lower high, it is consider a sign of MACD positive divergence.

A MACD positive divergence is a sign that the price is going to move up soon and therefore you can start to look for opportunity to go HIGH.

The purpose of this divergence is to help you predict the movement of the price so that you can only enter trades that are in the direction of the predicted movement.

This will greatly improve your winning probability.

For those of you who are interested to see how I trade, you can take a look at my FREE Live Trading Room where I will allow you to watch over my shoulder to see how I trade everyday and how I setup my chart everyday.

Click Here For My Live Trading Room

 

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Importance of Support & Resistance In Binary Trading

If you have been trading, you will know that the market is always moving in the form of waves. However most traders do not know how the waves is actually formed.

So I will like to use this post to illustrate to you guys the formation of the waves as it will be very useful for your trading.

So What Actually Causes Those Waves

The waves are the results of repulsion against levels of support and resistance.

SandR

So What are those Support and Resistance

There are various types of support and resistance and I am going to highlight them one by one in this post.

However I will write a detail blog post on each type of support and resistance in my other post as it will be too lengthy.

1) Major Swings

Major Swing

2) 200 EMA

downtrend ema

3) Fibonacci Retracement and Extension Levels

fib

4) Pivot Level

pivot

5) Bollinger Bands

bb

Personally I find these 5 types of support and resistance levels the most effective.

Whenever the price hits these levels for the first time, it will be repelled by it.

Whenever the price breaks through the level, it will form a new level of support and resistance.

For example, when you see the price breaking a level of support, the old support will now turn into a new resistance.

new resistance 2

So How Does Understanding S&R Help You In Your Trading

Now that you know where are those levels of strong support and resistance, you will be able to wait for the price to hit those levels for the first time and then enter a binary trade based on the repulsion.

Note that there will be more risks when the price hits the same level again as there are 50-50 chance where the price will break through it.

Therefore I will suggest that you only trade the repulsion based on the first repulsion. However in order to increase your probability of winning, you will need to make use of other indicators and techniques to do so.

Therefore I will suggest that you read my blog post on How to formulate your own strategy to formulate your own strategy.

A personal advice for those of you who are still trading without a strategy, you are going to lose all your money in no time. There is no way anyone can make money from trading binary without a proven strategy.

I hope that you guys find this post useful and if you have any question regarding binary trading, do feel free to contact me via the link at the side of this blog.

For those of you who will like to see exactly how I trade everyday, please click on the link below to see how you can gain FREE access to my Live Trading Room

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For those of you who are interested to learn the exact strategies that I am using to trade everyday, please click on the link below for more information about my course.

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Disclaimer

Binary Options carry a high level of risk to your capital due to the volatility in the underlying market. These products may not be suitable for all investors. Therefore, you should ensure that you understand the risks and seek advice from an independent and suitably licensed financial advisor.

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Problems With Binary Option Brokers

This post is a consolidation of the feedback from readers of my blog about the binary option brokers that have used before. In this post, I will not disclosed the broker’s name.

No matter whether you are trading stocks, forex or binary option, you will need to have a reliable broker that you can trust. For me, there are 2 things that I am very particular about when choosing my forex broker and binary option broker.

Continue Reading

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