The 60 seconds binary options strategy on the basis of technical analysis pattern "Diamond" is another effective strategy for trading turbo options. As you know, the most accurate signals of reversal or continuation of a trend are given by head and shoulders, double top, flag, and others. Diamond is also one of them but appears rarely. However, this doesn’t diminish its importance, the signal strength, or the opportunity to earn. In addition, “diamond” refers to the reversal pattern, and you know that often trend reversal on the 60 seconds options charts is the first thing that makes traders lose. Therefore, it is better to know in advance about the turn than to count your losses.
Pattern diamond is formed by parallel support and resistance lines. It’s like a diamond on the chart, hence its name.
Diamond is formed at the top or at the bottom of a trend. If a diamond is at the bottom of the trend, we can expect the formation of an uptrend and purchase CALL options. Accordingly, if the diamond is formed on top of the trend, you should expect a downtrend and purchase PUT options. It is believed that the formation of a diamond on top of a trend is faster than on the bottom. In this case, the diamond on top of the trend is more volatile.
It’s not recommended to trade inside the diamond. You must wait until it is 100% formed and resume trading. A diamond is formed during the uncertainty of bulls and bears in the market when they can’t decide and are waiting for fundamental data to reverse the trend.
Buying options CALL
As already mentioned, it’s not recommended to trade inside a diamond, so you can purchase options CALL at the breakdown of the figure. There are some tips for buying a CALL option when the diamond is formed at the bottom of the trend:
• Purchase CALL options when the price breaks the trend line. A perfect time is when the candle closes above the trend line. In this case, it’s the strongest signal and probability of a future uptrend.
• When the price is above the highest point of the diamond
• When the price retested the previously broken line of the diamond
Buying options PUT
Make reverse actions when a Diamond is forming at the top of the trend. Purchase PUT options under these conditions:
• The price is below the lowest point of the diamond
• The price is lower than the lowest top of the diamond
• The price retested the previously broken line of the diamond
Potential of Diamond
Despite strong signals, the diamond is a weak figure. It’s better to say the strength of the diamond quickly runs out.
Often, after the price breaks through the boundaries of the diamond, you can see rollback because the price spends a large force for the pattern breakdown.
60 seconds binary options strategy on the basis of the pattern Diamond may seem tricky and rarely used at the first glance. However, don’t forget that if you trade 60 seconds options, the situation on the chart is often changing, and the more patterns, indicators, and strategies you know, the higher probability of your profits.