This strategy’s name does not actually say it all. Trading Off the Daily Chart Strategy does not let you trade off the daily chart all the time but it makes use of Stochastics and the popular Fibonacci Retracement for signal generation. This is typically a strategy that follows trend and it is something that is very effective. The author claims that this is an easy to use strategy. As a matter of fact it is not that complex but makes use of advanced techniques.
WHAT IS THE TRADING OFF THE DAILY CHART STRATEGY?
Just like many successful strategies out there, the author presumes that trends are your buddies and you need to follow your friends. This system follows initial trends and makes use of daily charts to create signals. Initially, this strategy is made for Forex but it can be used for binary trading options. It aims to identify the entry point and signals on daily charts thereby offering more trustworthy signals as compared to other strategies. It also give more time for you to discover it and amplify the possibility of profits on your trades.
HOW DOES THIS STRATEGY WORK?
When you want this strategy to work for you, you need to understand underlying primary and long term trends. The author focuses on Forex but this can work fairly on basic assets that come with price charts. When the trend is identifies, the author suggests that you identify the continuation signals. This greatly relies on Fibonacci retracements as well as Stochastic crossovers for its entry points. If you do not make use of the Fibonacci retracement for trend line market analysis, you may also use moving averages and support and resistance.
Bounces and/or pullbacks will always be there when trends are up or down. When either of these tow happens, the author makes us of retracement lines as possible trend areas. He then makes use of stochastic crossovers and price patterns in order to set off trend signals but the author sees to it that he uses primary trends. Because standard option and Forex are as open ended as binary options, the author provides some exit advice. As for binary options, you may use monthly or weekly expirations in order to give more time for the trade.
WHY IS THIS A GOOD STRATEGY?
This strategy is good because it can offer reliable signals and it is very much ideal for binary traders who do not opt day trades. Following trend is by far a great way for trading and daily charts can offer clearer views of trend as compared to tick charts or hourly and minute charts. With regards to binary options, such strategy also provides the chance to trade similar and reliable and profitable multiple times. This means that when you make your first buy and trading starts to move to the correct direction you can then enter again thereby making your profit growth more probable.
This strategy is also great for binary options because of its risk and reward profile. In basic options, forex and futures, there are always chances where trade can move on the wrong directions because it even moves together with you. This will lead to a halt in your position or even a margin call. Because binary options contain risk reward, win or lose profile, there is no problem stopping margin calls. All you do is wait for trade to have that perfect move. Above this, the strategy also mixes with other great tools for technical analysis. These include Stochastic and Fibonacci.
WHY IS THIS A BAD STRATEGY?
If you do not have patience then you should not use this strategy. Signals will not come to you every week or every day, you have to wait for the right set ups. If you do not wait then might lose out. Most traders are high frequency and short term traders. With this strategy, you can radically trim down your prospect trades.
This strategy can be easily used by beginners and experienced traders. This can be used by those interested in monthly or weekly binary options trading. If you use this properly you can surely earn great profits.