Effective binary options strategy “Spring” with just 3 simple indicators
“Spring” is easy to use binary options strategy. It includes just 3 well-known indicators but shows super results. Read how to use this profitable binary options strategy.
What indicators does the strategy “Spring” include?
Using reversal strategy, it is important to choose the right parameters for indicators because, in fact, we trade against the main trend, and it is not always easy. Despite the widespread belief that the best settings for the indicators are parameters set as default (recommended by the authors), when trading against the trend, I recommend increasing the default settings in order to additionally filter false signals. In this strategy, I will use three types of indicators, considering each depending on its degree of importance.
1. CCI (commodity channel index) with settings 200 and -200
The default settings for this indicator are the levels of 100 and -100. By increasing these parameters two times, we filter all false signals that wouldn’t have worked up to 200 and -200 in order to obtain more accurate signals.
2. BB (Bollinger bands) with the default settings
Bollinger Bands is the favorite channel indicator for many traders. Most strategies are based on this indicator. As the rule, traders use the breakdown of the channel. However, as practice shows, the breakdown of the Bollinger bands doesn’t mean a reversal of price, so this indicator is a minor one.
3. Stoch (stochastic oscillator) settings 5,3,3
We make fast settings for the Stochastic indicator, which will help trace the beginning of the local price reversal from the overbought (80) and oversold (20).
Rules of binary options' strategy "Spring"
Rules of purchasing a CALL option:
• CCI returns from -200 zone;
• Price is moving below the lower Bollinger band;
• Stochastic is crossing oversold (below 20);
• We buy a CALL option on the 2 candles ahead.
Rules of a purchasing a PUT option:
• CCI returns from the 200 zone;
• Price is moving above the upper Bollinger band;
• Stochastic crosses overbought (above 80);
• We buy a PUT option on the 2 candles ahead.
You can choose any timeframe for binary options' strategy "Spring" starting from 5 minutes. The higher timeframe gives the more accurate signals.
The reversal strategy categorically doesn’t work before and after the release of important news. Prior to the news, the market is flat; after the publication of the news, the price goes up or down depending upon the data. Both situations are unfavorable for trade. In the first case, you’ll see side movement. In the second case, the reverse may not happen, despite all the indicators.