Waves Touch Binary Options Strategy
The Waves Touch binary options trading strategy is a strategy designed for the Touch/No Touch trade format. The strategy utilizes the WATL Trendlines.ex4 indicator.
- MetaTrader4 Indicators: WATL Trendlines.ex4 indicator (default setting).
- Preferred Time Frame(s): 15 minutes, 30 minutes, 1 hour
- 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.
TRADE Example (click the image for full size):
The WATL Trendlines.ex4 indicator will draw trend lines across the price highs and lows at various points. The unique thing about the indicator is that it is able to draw these trendlines across points of major and minor supports and resistance, and project same into the future.
This increases the number of trade opportunities, beyond what similar indicators that draw trend lines are able to give. The price action will bounce from one trend line to the other.
Two types of Touch/No Touch trades are found on various platforms. While the trade structure is usually the same, there are differences in what the trader can do with the strike prices.
Some platforms allow traders to set their own strikes for the trades, while others have pre-determined strikes. Either way, the trader can use this setup to trade comfortably.
This strategy is designed for just the TOUCH component of a Touch/No Touch trade.
TOUCH ENTRY RULES
If the trader intends to select Touch for the trade, the following is done:
- The first step is to wait for the projected trend lines to be traced by the WATL Trendlines.ex4 indicator. In other words, the indicator will trace trendlines into the future.
- Once there are trend lines that can converge into a triangle shape as shown by the areas marked 1,2,3,4,5 and 6 demarcate these areas with a line tool to make them visually distinct.
- Check to see that the strike prices are located within a marked area. If yes, then select the TOUCH option for this strike price.
Expiry for Touch Trade
The trader needs the trade open for as long as possible. So the time for expiry for the trade must span at least 6-8 candles. For this chart example, we will use an expiration time of at least 6 to 8 hours, since this is a one hour chart.
Early Exit Strategy
There is no early exit for this trade. Once the price action touches a strike price during the duration of the trade, the trade is closed in profit.
About The Trading Indicator
The WATL Trendlines.ex4 indicator draws clear trend lines across both major and minor support/resistance levels. This enables suitable areas to be demarcated in triangular shapes so as to enclose areas where the strike price is located.
This trade strategy can therefore isolate areas where a Touch strike price is most likely going to be activated by advancing and retreating price action. The strategy is not suitable for the one-week One Touch trade type. So ensure you practice this strategy on a platform which enables you to use a demo account.