How Do You Trade 60 second Binary Options?
by Girvan Lambert
Short term options like the 60 second options offered by most online brokers out there, have a reputation of being little more than gambling. Indeed, when expiry comes about within just a handful of seconds, one will find it extremely difficult to find a workable strategy for the situation. There's simply no meaningful time-frame to work with. With the above in mind, my first suggestion in this respect would be for traders to steer clear of such 60-second trades. There will of course always be traders drawn in by the high-risk/quick reward potential of the scheme and as such, there will always be traders looking to "abuse" these options. The following is addressed to such people.
If you must trade 60 second options, you have to know that there's one approach which is statistically healthier than simply crapshooting the issue: the "strategy" is quite elementary as it's based on a simple support/resistance level approach, but it's better than nothing.
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The first thing you want for this strategy to work is a period of relative market stability. Such periods are notoriously bad for Forex trading (in the case of currency-pairs) because the asset-price tends to move though limited fluctuations within a rather restricted range. In the case of 60-second binary options, this is exactly what you should be looking for. Once you manage to find such an area of market lateralization, you're going to be looking for the formation of a support and a resistance level on a chart with a 1 minute time frame. As you know, the price-action bounces off these support/resistance levels, which means that with the exception of the first such bounce-backs, you'll be able to exploit the phenomenon with short-term trades. Once you have such a support-resistance channel established, you can essentially work it until the asset price breaks out of this channel. What that means is that besides missing out on the first couple of trading opportunities as said above, your last trade of a "run" will inevitably end up a loser (as this is where you'll see that your channel has been busted and you need to look to re-define it elsewhere).
In order to further confirm the lack of any given trend ( and thus the presence of lateralization) within the time-frame you're targeting, it is recommended that you use an indicator like the ADX.
This is essentially what this strategy is about, and while it may seem simplistic, it is in fact rather logical and straightforward. Also, it is way better than just rolling the dice on every single trade that you place: such an approach is always a guaranteed long term loser.