Binary Options 120sec Strategy

Mike..

I applaud, and am grateful for your post. Honest and valid. And a breath of reality in the general smog of self delusion here.

Only 1-3% of Fx spot traders make money long term, without additional revenue from selling signals, providing advice/education and/or other associated services, OR without professional Sellside background/ experience. 99% of Retail traders, are no more than accidents waiting to happen.
Binary Option trading is no different. Except that its easier for the inexperienced to engage, "understand", and provides a much more excitement/entertainment value , not unlike a casino.

A mentor of mine used to say..
If you dont know who you are, the markets are a very expensive place to discover that.

You are quite correct in implying that 96-98% will loose money longterm in BO trading.
As will same proportion of retail Fx Spot traders. Sadly many having been helped on their way to ruin by unscrupulous brokers, who are more rife in BO space than in the Spot space .( if only because the popular BO sellside model is currently at early stage development)
Is this just my opinion? Sadly not. I know that AS FACT, from many old colleagues from the sellside industry.
And inside & published, industry disclosure figures from US sources.

In this, Fx option trading is no different from spot Fx. Unfortunately while FX Spot requires some application to understand and engage with.
BOs are much more like "Party Poker", and infact for 99% of their clients are ever little more than that.
Its a sad reality, and self-help sites like FF while intentionally good, are merely broadcasters of the triumph of Hope over Experience message that retail punters are so anxious to believe..

There are NO FREE LUNCHES/

SO..
On the other side.. I DONT agree with your suggestion that it is not possible to long term and consistently profit from BO trading.
It is. I and two of my oldest colleagues with long histories in Equity and Fx markets/ do. And find it a much less stressful exercise than traditional methods.
Do any of us want to tell everyone how?
Yes maybe, but in truth we dont know how.
All of us will tell you we use only PA, S&R, and maybe one simple indictor.
The REALITY is that these only provide a basic trade structure, and that the success comes from unquantifiable gut reactions, that come from over 10,000 -20,000 hours of chart watching over 10-20 years. The success comes from the trades we DONT take.. because despite all the flags, we SMELL something wrong.
And that SMELL only comes with experience. IMHE, in ALL systems, the profit is made in the trades you DONT take and not those you do.

I trade BOs now for three reasons..
My primary consideration has been my long term and frustrated interest in scalping.
For those who have at some time in their careers, experimented with what appear, in testing, to be profitable, tight scalping strategies,
the reality of live market Transaction Costs, (spreads/slippage/execution latency etc) will have provided a reality-check
on the ability of a retail trader to trade this type of trade profitably. As a result its been a no-go area over my trading career.
Trading BOs, despite the often high "House-Margin" has at least given me a level-playing field for revisiting and applying such strategies.
Two further important considerations for my interest in BO involves RoI, and secure VaR management.
Ive always taken an "investment" approach to trading, and always focused and judged my efforts on a Return on Capital basis.
As anyone with a consistent record of return in Spot/futures will attest, a properly funded, and prudently operated Spot account
involves tying up substantial capital. Which in turn seriously caps the relative return potential, on the capital deployed.
BO trading, requires a considerably lower deployment of capital.
In relation to VaR management, the recent in the SwissCB Cap removal, provided a sharp (if extreme) lesson for a lot of spot traders
on the dangers of relying on stops as a guarantee of secure Risk Management.

Hope these thoughts shared may be of some help to thread viewers. And to existing and potential BO traders.
I dont mean to rain on anyones parade. But at the end of the day, we all have to live in reality.
And sadly these are the realities Ive observed over 10 years in Fx, and why I dont see BOs an anything different in risk terms.
And I share NOT as one thats lost in that journey, but one thats been lucky, ahad great mentors, and understand a little now that markets, are the hardest way to make easy money I know.

C

Good day Mr Jossstick,

I must say, thank you very much for this thread, very informative.
I just loaded the setting on my 5min Graph and I've seen 5 possible wins and no losses, using your methods you stated, I like what I see.

Kind regards,

MrBeano.

see next

In my earlier post above (Feb 6, 2015) I made the point that ultimately the overwhelming probability of loosing money as a BO Trader, (referred to by Mike in his earlier post above) is actually no different than that of a Retail SpotFx Trader. However, Sellside brokers anecdotally agree that the rate of loss is faster, mainly because the average BO trader has significantly less Fx, money management and market experience than the average retail Fx spot Trader, and because the BO trading process is simpler.

However.. that said, can I challenge a key argument in the adverse comparison of winning probability in BO versus Fx Spot as the perceived payout imbalance.
A BO trader may typically for example risk $100 for a win payout of $85?
However what if we were to look at the same BO trade ($85 stake with a $15 transaction cost)...
And deconstruct a similar yielding one lot FX Spot scalp trade into Trade risk, profit and Transaction cost?

So who would like to do the sums?

Symptoms of a loser

Hi

Being a complete novice to this and want to test out the strategy, please can you explain what the purpose of the additional bollinger band is for please at the higher and lower end or what u call BB3 i believe?
Does the body of the candle or the wick of the candle have to cross or just be close to the bands to open a possible trade? and in these instances which band to look at?

Many thanks in advance.

Me,too
can't understand that Deviation: 3,2 and Deviation 2,3

Need help.

And I want to provide a thinking about how to avoid the blow-up of the account by using martingale
If you lose one trade, just stop for a while and wait for a new chance occurs and use martingale strategy for this time, which means you don't join the current trend which made you lose and waiting for the market to be normal again and a new chance appears.

I'm not sure whether you can understand what I'm talking about, cause I'm not native speaker.