NADEX 2 hour Binary Option Tip

First thing I want to let everyone know is that I do not reveal my specific trading strategy on message boards...for various reasons....so you'll have to come up with your own strategy with this tip.

For those of you who are not familiar with Nadex binary options, let me give you a brief introduction to them. Nadex Binary Options are simple to trade, but it does take a month or two before it becomes second nature to trade them, so be patient.

A Nadex Binary Option contract is a simple TRUE or FALSE statement that you are betting on. A 2 hour Nadex Binary Option statement goes something like this:

USD/CHF > .8909 10am - 12 pm

This means that if you BUY this statement, the price of USD/CHF must be ABOVE or GREATER THAN .8909 by 12 pm. If you SELL this statement then you are betting that the price of USD/CHF will be LESS THAN .8909 by 12 pm. If you bet on the right outcome then you will profit, if you are wrong, you will lose whatever money you put into the bet. The benefit of this trading is that there is no stop loss, and you can only lose what you put into the trade.

So what is the tip?

Well, to understand the tip you have to understand a problem with the 2 hour binary option contracts. Here's the problem: The strike price for the 2 hour binary contracts, the actual price that you are betting for or against (the .8909 in the USD/CHF > .8909 10am - 12 pm) is set 10 minutes BEFORE 10 a.m. A lot can happen between 9:50 am and 10:00 am. So lets say the USD/CHF is clearly bearish, and we want to sell the USD/CHF > .8909 10am - 12 pm statement. Before 10:00 am comes, say at 9:56 am, the USD/CHF suddenly goes down even further. Now your USD/CHF > .8909 10am - 12 pm statement is even more expensive to sell because it is more probable to be true (the price has gown down to .88975.) So now, when 10:00 am rolls around it would cost something like $70.00 just to make $30 in profit.

So here is a simple tip:

Place a WORKING ORDER (or Pending Order) to sell the USD/CHF > .8909 10am - 12 pm when the price retracts back above .8909. In other words, you will place a working order for whatever price you want to get into with the contract. Candles have a tendency to form an opposite WICK before they head in their final direction (aka stop hunting,) it is when the wick forms that your proper order will be triggered. Thus, when USD/CHF heads a bit upwards before heading down your WORKING ORDER will be triggered. Now, this is where it really gets good. You can set your working order to give you MORE profit. Instead of selling the USD/CHF at a cost of $50 to us, we can set the pending order up so that when the USD/CHF goes up even higher (before heading down,) we get in at an even cheaper price...thus making more money. So instead of getting in at a cost of $50, we can get in at a cost of only $25 per contract and win a %200 percent profit....all in 2 hours...with no stop loss!

This image is a little hard to see, but if you click on it you can see what I am referring to. The Candle's top wick will trigger our working (pending) order for either a 1:1 reward to risk ratio or a 3:1+ reward to risk ratio.

http://www.freeimagehosting.net/t/95c90.gif

i appreciate all your post involving binary options...bull spreads too. i recently opened an account and understand te process. i like te web seminars from nadex. it seems to me you trade long directional and as well as volatile styles .

im still in demo but you introdcuing binaries open my eyes to various ways trading spot forex.

When the underlying instrument undergoes a pullback and passes the strike price (but eventually reverses and continues in the original direction before expiration), have you found there to be a limit to how far the binary price will travel beyond/below $50 (i.e. a stagnation in price)?

once it goes beyond the strike - i.e. buy goes above strike or short goes below strike it can keep going but you will usually cap out around $97 on the buy side and $3 on the sell side

I dont find it useful to trade binary because high risk and high return. Is a fair game indeed. Closely strike price pertains high costing, and cheaper cost contributes low probability due to time of expire.

However, it is best if could combine with other instrument such as hedging at strike price (Pending order) after binary has been brought in with profit status. The purpose is to lock the profit since the binary winning is full amount. Meanwhile, if price goes against you, you lose the outcome of binary but gain some back with the hedging.

So far i had done this several time especially for weekly binary. Time of contract is sufficient and market volatility is able to provide such potential. Anywhere i am not longer to trade this because seem like not much profitable. Maybe i am not that good enough.

bucket shop binaries yes
they only pay out from 75% to 85% of premium.....the house obviously wins

nadex i have tried and seems to be different your payout is not a set amount is basically the movement of the delta as you sell or exercise from what I see but someone here could know more about that than me.

can i trade on nadex stile platform in uk rang ig but they say i cannot