How To Use Support And Resistance Lines When Trading Binary Options

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If you have been trading, you will know that the market is always moving in the form of waves. However most traders do not know how the waves is actually formed. So I will like to use this post to illustrate to you guys the formation of the waves as it will be very useful for your trading. The waves are the results of repulsion against levels of support and resistance. So What are those Support and Resistance. There are various types of support and resistance and I am going to highlight them one by one in this post.

However I will write a detail blog post on each type of support and resistance binary option indicator in my other post as it will be too lengthy. Personally I find these 5 types of support and resistance levels the most effective.

Whenever the price hits these levels for the first time, it will be repelled by it. Whenever the price breaks support and resistance meta binary options the level, it will form a new level of support and resistance.

For example, when you see the price breaking a level of support, the old support will now turn into a new resistance. Now that you know where are those levels of strong support and resistance, you will be able to wait for the price to hit those levels for the first time and then enter a binary trade based on the repulsion.

Note that there will be more risks when the price support and resistance meta binary options the support and resistance meta binary options level again as there are chance where the price will break through it. Therefore I will suggest that you only trade the repulsion based on support and resistance meta binary options first repulsion. However in order to increase your probability of winning, you will need to make use of other indicators and techniques to support and resistance meta binary options so.

Therefore I will suggest that you read my blog post on How to formulate your own binary option strategy to formulate your own strategy. A personal advice for those of you who are still trading without a binary option strategyyou are going to lose all your money in no time. There is no way anyone can make money from trading binary without a proven strategy. I hope that you guys find this post useful and if you have any question regarding binary trading, do feel free to contact me via the link at the side of this blog.

For those of you who are interested to learn the binary option strategy that works for me, please click on the link below for more information about my course. Binary Options Strategy Binary Option Signal Learn various binary options strategy from the binary options signal blog created by a real trader who has been trading profitably since So What are those Support and Resistance There are various types of support and resistance and I am going to highlight them one by one in this post.

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My trading style is based on support and resistance breakouts for trading 5-minute binary options. It is a simple breakouts strategy that uses two Meta Trader 4 indicators: To perform successfully with this trading style, you need price action knowledge and should spend some time on the charts.

The currency pair found resistance at As you can see on the chart, the 21 EMA clearly shows the price was moving south. After a small pullback 3 bullish candles , the pair found new resistance, after which the price continued south. The fourth white candle broke the support, and I entered my Put trade at the opening of the fifth bearish candle. The candle opened at After losing pips, the price started to consolidate, and I was looking to enter a Call trade.

The fourth candle bullish candle with no wicks closed above the most recent resistance, and I placed a 5-minute Call trade. The Euro was boosted after the positive macroeconomic news; the pair reached new high of 1. I waited for some time to take this trade, but in the end, it paid off. After three indecisive candles that just closed above the recent resistance, I decided to go with a 5-minute Call trade.

The price was moving in a channel with lower highs and an overextended bullish candle brokered the channel. I didn't place a Call binary option on the next candle, but it would have been an ITM trade as well.

By following my strategy, I waited for a breakout in the opposite direction, which happened on the second bearish candle after the newly created resistance. You can clearly see on the chart the reversal in direction and the small channel with lower highs.

The price clearly continues south, and I was looking to place a Put trade. The big bearish candle smashed out of the channel, one minute before the close, I entered my trade. I didn't wait for the full close because I was expecting an undeceive candle doji to follow. As you can see, it came out a hammer. Entering at the opening of the new candle would have been an ITM trade as well, a very lucky one, just one pip lower. The Pound just bounced from support 1. After two indecisive candles closed below, a small bullish candle closed above the resistance 1.

I decided it was time for my Call trade, but that decision proved to be wrong. The breaking black candle was too small to continue the buyers' enthusiasm, and that was my main mistake here.

You can clearly see the formed channel and its break out with a big bearish candle. I entered my Put trade at the close of the breaking candle as I expected the down trend to continue, which proved to be the correct decision here.

On the 5-min chart above, you can see three bearish candles closing below the support line, and in all three cases, it follows another bearish candle. When the price is moving in a downtrend and a bearish candle closes below support, it proves to be a good Put trade signal.

I have placed a Put binary option in the last scenario on this chart, which one may consider a bit risky because of the long wick. Dollar was boosted because of revised data, which shows an economic growth of 3.

After the pullback, the pair was on a rally again, and I placed a 5-minute Call trade based on pure price action. You can see the unsuccessful attempt of breaking resistance by the bullish candle with the big wick inverted hammer. Thus, I had to wait and see what came next. Two small bearish candles were engulfed by a strong bullish candle with almost no wicks.

At the close of that candle, I entered a new 5-minute Call trade. The British pound was boosted after some positive Brexit headlines earlier today, but later plummeted over pips because of a failed Brexit deal. On the 5-minute chart, you can see the overextended candle with a big wick that broke the recent support. I prefer skip trading after such an indecisive candlestick.

The next bearish candle closed with almost no wick, and I entered my 5-min Put trade, which closed in the money. If you want to use the 5 minute strategy you can download free indicators and template. Please keep in mind you need some price action knowledge to perform the strategy successfully.

The article is written for informative purposes only and it is not financial advice. The author does not have any position in the currency pairs mentioned, and no plans to initiate a position. He wrote the article himself and expressed his own opinions.

He has no business nor personal relationships with any mentioned government entities or stocks. Readers should not treat any opinion expressed by the author as a specific inducement to make a particular trade or follow a particular strategy, but only as an expression of his opinion.

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