Bearish Put Strategy for Binary Options
Tuesday, November 12th, 2013 by Tim Lanoue
The purpose of today’s article is to give you a binary options put strategy designed specifically for put trades that will hopefully contribute to your success down the road. The ability to utilize a variety of binary option trading strategies is a necessity when it comes to trading online. Just like how the world itself is constantly changing so are the markets which is why we need a variety of strategies to implement for when the market is not always in our favor. When it comes to being an intelligent, successful trader oftentimes you will learn that they have studied the markets for quite a bit of time and have an array of strategies which ultimately is what we want to aim for. Gaining experience while becoming a dynamic trader is what ultimately will lead to our success as a trader. Moving forward we will dive into how to implement this easy strategy that can yield high returns when traded correctly.
In the picture below you can see we have the Eur/Usd asset on a 10 minute time frame. When using this bearish put strategy it is important to stick around with expiry times consisting of 5-15 minutes, any longer than that and our signals would become invalid. In this strategy we have a total of four trading indicators, three of which are simple moving averages while the other is a momentum indicator. Below we can see that the three moving averages are set at 1, 18 and 39 while the momentum indicator is set at a period of 10. The moving average 1 is the purple line and is also our “signal” line. Moving average 18 is seen as the blue line while the 39 moving average is the yellow line. The purpose of the blue and yellow lines are to act as tool to help find support and resistance levels, if you follow the lines closely you can see how they often run across support and resistance levels.
When it comes to placing a trade we need to wait for two conditions to be met, the first condition is that our signal line must break in a downward direction. The last condition that must be met is that we need our momentum indicator to break in a downward direction in correlation with our signal line like seen in all four examples in the picture above. You do not have to wait for a confirmation candle to appear but it may serve you better if you do or make sure your candle is bearish before placing put trades.
Becoming a dynamic, successful trader is no easy task but by spending time researching and implementing new strategies the chances of you succeeding increase exponentially. This put strategy is relatively simple to implement and can yield many wins when used properly. If you have any questions please feel free to leave a comment below!
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