Strategy «Rainbow»: intuitive trading in binary options
- VFX Blog
When thinking about how to make money on binary options, beginners primarily study strategies, technical and fundamental analysis. They forget that there is another factor of success, which is given by nature - intuition. If you make her your ally, you can always be one step ahead of the rest. Try to use it and your knowledge with the «Rainbow» strategy.
Any in the range M1-M5. In our case, M1 is used, but with an increasing period of analysis, the accuracy of the signal an increasing.
Any currency pair. The main requirement is a fixed (2-3 points) spread and no hidden fees.
All Forex trading sessions.
Percentage premium option:
Not less than 70-75%.
The strategy uses one standard indicator:
• Rainbow Moving Average. A trend indicator is a few simple Moving Average with the same period and different offset relative to the current price. The idea of the indicator is that a different offset shows the trend on higher and lower timeframes relative to the current one and makes it possible to accurately open the binary option. A similar technique is used in the Ichimoku Kinko Hyo strategy on which you can also test your trader's intuition without which you cannot achieve real success.
The indicator is not available on all binary options sites. In our case? the broker's Deriv trading platform is used Binary.com. If your broker does not have this indicator, you can download it for free on the Internet and use it in any other trading terminal (such as MetaTrader) as a signal to open an option on your account.
After installing the moving averages, the terminal’s working screen takes the following form (the color gamut can be changed):
Binary options signals:
• CALL (RISE) option. The price punches from the bottom up all Moving Average or goes into the "cloud" of the indicator. The second option is only for professional traders!
• PUT (FALL) option. Opposite conditions - the price below all Moving Average or from top to bottom goes into the "cloud".
Another condition is patience. You can try to enter the first candle of a different color, but it is better to wait for the full binary signals. The expiration time of the options should be at least 5-7 minutes, even if a minute is selected as the working timeframe, as in our video.
Recommendations about use
• Tools of the same group, in our case, trend instruments, even with different parameters, cannot be a decisive factor in opening a new position. It is recommended to receive additional confirmation from oscillators, for example, RSI, CCI, Stochastic, or vfxAlert binary signal software, which correctly take into account the appearance of overbought/oversold situations and the dynamics of volatility.
• When trading intraday, we recommend performing a comprehensive analysis of the market − as a rule, there are many typical situations on different assets and timeframes, to which moving averages react the same.
• During the publication of important fundamental news and statistics, we do not open options 30 minutes before the news and 30 minutes after the publication; cautious traders can close current deals. To control the events, we use the economic calendar included in the all popular binary trading platform!
• You can significantly improve the result of scalping if you perform analysis on multiple timeframes simultaneously. For example, periods M5-M15 can give a hidden signal of a trend change, which is then confirmed by a deal on M1.
Automatic trading according to the «Rainbow» strategy is possible: several versions of binary option bot can be found on the network, but, like on any scalping system, it is better to trade manually using this scheme. This will allow you to more effectively tune the system to market changes, and the multicurrency properties of the strategy guarantee you a stable arrival every day.