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Binary Options: Bollinger and Martingale

Adam titcher

There are a handful of charts that you should become familiar with when becoming a professional binary options trader. There are specific tools used with NetDania, a fantastic source for charts and trend watching.

You are going to want to get a strong grasp on the following:

  • Bollinger Bands
  • RSI (Relative Strength Index
  • Martingale Strategy

BOLLINGER BANDS:

Bollinger Bands measure the “highness” or “lowness” of the asset Can be stocks, commodities, indexes or Forex currency pairs. More price relative to previous trades made.

RSI (RELATIVE STRENGTH INDEX):

The RSI is a technical The use of the term technical The use of the term technical The use of the term technical in trading usually refers to a variety of methods in which a trader or... More in trading usually refers to a variety of methods in which a trader or... More in trading usually refers to a variety of methods in which a trader or... More indicator used to measure the strength or weakness of a stock to determine if it is overbought or oversold. A trader using RSI should be aware that large surges and drops are expected in the price of any asset Can be stocks, commodities, indexes or Forex currency pairs. More and can and will affect the RSI result creating false buy (CALL) or sell (PUT) signals. RSI is popular because it scales a large array of trends to make a guess. This is why the RSI is best used as a valuable complement to other stock-picking tools.

MARTINGALE SYSTEM/STRATEGY:

Before applying this strategy, make sure that you have the balance required with a strong sense and many trades under your belt in understanding BBs and RSI scales.

This system takes the tools above and makes sure that you maximize your profit outcome with them.

Whenever taking a first trade, apply a variable of ‘X’ amount of money. If you lose that trade, the next one you apply should be your money, X*3. If you lose that trade, the next one you apply X*3². Again, if you lose that trade you will apply X*3³. And so on and so on X*3⁴ and X*3⁵…..

There is a very low probability that the fourth will lose, as even a lower probability that the fifth will lose. If you continue to win, you start with your basic trade of ‘X’ amount again. Keep trading ‘X’ until you lose to apply this principle.

Here is an example of the strategy.

First trade: $5 and you lose; Second trade: $5 * 3 = $15, and you lose; Third trade: $5 * 3² = $45 and you lose; Fourth trade: $5 * 3³ = $135 and you lose (low probability); Fifth trade: $5 * 3⁴ = $405 and you should win. Let us suggest that you made the bet with a 70% profit, thus netting $283.50 on this trade!

Even when you calculate your losses, you still net a profit: $5 + $15 + $45 + $135 = $200. You still profit $83.50 over a five trade period.

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