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Arrow Signal Binary Options Strategy

The binary options trading strategy based on the Arrow_Signal.ex4 indicator is a binary trading strategy which aims to define trading opportunities based on direction. This strategy displays arrows on the chart where the trader can buy or sell. However, this strategy must be used according to the rules spelt out below to ensure profitability.

Chart Setup

  • MetaTrader4 Indicators: Arrow_Signals.ex4 (default setting); MAAngle.ex4 (default settings).
  • Preferred Time Frame(s):  1-Hour (optimum performance).
  • Recommended Trading Sessions: Any time. Depends on when the indicator signal appears on the chart.
  • Currency Pairs: Any. It can also be used on other asset classes.

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Download the Arrow Signals Binary Options Strategy

Strategy

The Arrow_Signals.ex4 will point out a buy or sell point based on blue (up) arrows or red (down) arrows respectively. However, the indicator tends to repaint. The trade should not be taken when the arrow appears but at the open price of the next candle, subject to confirmation from the MAAngle.ex4 histogram.

CALL Example (click the image for full size):

Arrow-signal-binary-options-strategy

CALL ENTRY RULES

A Call trade is setup when the following occurs:

  • A blue arrow which points upwards appears at the same time that the MAAngle.ex4 indicator histogram is blue.
  • Set the Call at the open of the next candle which follows the candle bearing the arrow to avoid trading on a repainted arrow signal.

Expiry for Call Trade

Set the expiry time of the trade to close at the closing price of the 2nd candle. This puts expiration at 2 candle lengths or 2 hours.

Early Exit Strategy

You can also close the trade early when the trade is in profit for a smaller payout.

Precautions: Histogram must be green for trade to be valid. See chart for areas where arrow signals are not valid.

PUT ENTRY RULES

A PUT trade is setup when the following occurs:

  • A red arrow which points downwards appears at the same time that the MAAngle.ex4 indicator histogram is red in colour.
  • Set the PUT at the open of the next candle which follows the candle bearing the arrow to avoid trading on a repainted arrow signal.

Arrow-signal-binary-options-system

Expiry for PUT Trade

Set the expiry time of the trade to close at the closing price of the 2nd candle. This puts expiration at 2 candle lengths or 2 hours.

Early Exit Strategy

You can also close the trade early when the trade is in profit for a smaller payout.

Precautions: Histogram must be red for trade to be valid. Avoid trading on yellow or green histogram-coloured areas. See chart for areas where arrow signals are not valid.

Download

Download the Arrow Signals Binary Options Strategy

About The Trading Indicators

The Arrow_Signal.ex4 indicator makes it easy for binary options traders to execute trades by showing clear entry points. However, success in binary options is also dependent on the trade expiry and the indicator does not show this.

It is therefore pertinent to close the trade using 2 candle lengths, as backtests have shown this to be a valid way to end trades profitability with this strategy.

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