Trend Prediction Boundary Binary Options Strategy
The Trend Prediction binary options trading strategy for the boundary options is used to trade the range of price movement of an asset. The boundary option is also known as the range option or the In/Out option trade type. This trade type measures the ability of the asset to either stay within a range of prices or to break out of that range.
The todaytrendprediction.ex4 indicator traces two horizontal lines on price action which are parallel to each other and therefore can be used to identify areas where the price action may either stay within a range or breakout of the range. Thus this indicator is suitable for use in trading the boundary option.
MetaTrader4 Indicators: todaytrendprediction.ex4 (default settings)
Preferred Time Frame(s): 15 minutes, 30 minutes, 1 hour
Recommended Trading Sessions: Any time the signal appears
Currency Pairs: USD pairs.
The strategy is to look for the green and red lines which are drawn by the indicator as support and resistance lines. These two lines represent the upper and lower boundaries. On most trading platforms, the upper and lower limits of price action are usually defined by the platform.
Therefore, it is essential you use In/Out trade variations that permit the trader to set their own boundaries for the trade. Using the lines drawn by the todaytrendprediction.ex4 indicator will serve just fine.
The trade play for this strategy is the OUT option.
This is how to trade the OUT version of the In/Out trade.
- It must be noted that almost every trade which is range bound will eventually experience a breakout. Therefore, using the OUT option gives a better opportunity at trade success than using the strategy.
- Choose an area where price is very close to one of the two trend lines, especially if the price is looking likely to move to that trend line. Use the arrow direction to detect this.
- Choose OUT of the two options on your binary platform. If one of the default price barriers is at the level of the trend line likely to be hit, then this will work out well. If your platform allows you to choose your price barriers, use the trend lines to do so.
The trade has to stay open long enough for the price action to move OUT of the trading range. So for this chart which is an M30 chart (30 minutes), try to leave the trade open for at least 6 candles. Once the price moves OUT, the trade is closed automatically in profit.
Early Exit Strategy
There is no early exit strategy. Once the trade has performed to expectation before expiration, it is automatically closed.
About The Trading Indicators
The todaytrendprediction.ex4 indicator is a good indicator for this strategy. This strategy requires assiduous practice on demo so as to know how to manipulate the price barriers to your benefit.