The «Vision» Second Strategy For Binomo
A trading strategy is a market analysis system consisting of a certain combination of indicators for trading binary options. Competent selection of the tools is a key success factor – they must be combined with each other to cancel out their own disadvantages. If two practically identical signals were used in combination with the signals from the indicator, then there would be no real sense in that. In this article we will look at the one-second «Vision» strategy, created specifically for Binomo. The system is based on 3 indicators – trend (Moving Average), oscillator (CCI), and pulse (Momentum).
A brief overview of the indicators
Moving Average is the basic technical analysis indicator and practically the only one. The averaging principle is used to some extent in all instruments, including oscillators. The great diversity of thousands of various indicators is achieved by modernizing the averaging formula. In most cases, the mathematically simple formula for calculating the arithmetic mean value is modernized almost beyond recognition. This approach allows you to achieve the most incredible results.
There are several dozens of popular types of Moving Averages, and there are 10 most popular options – all of which are present on the Binomo terminal. The «Vision» strategy uses Time Series Moving Average. The TSMA formula differs from other Moving Averages in its time reference, which is reflected in the instrument’s name. Without going into details, it can be noted that the nearest price bar has a higher priority than subsequent ones in the averaging formula.
Momentum is an impulse indicator showing the rate of price change. The beginning of strongly pronounced trends leads to an increase in volatility. The zero value is in the middle of the window near the middle border. An upward deviation of the curve indicates uptrend momentum strengthening, a downward deviation signals a downward trend.
CCI is an oscillator that was developed about 40 years ago to predict prices on commodity exchanges. The formula takes into account the deviation of the actual price of the asset from the average value obtained by averaging. Using pricing patterns, this indicator allows the trader to recognize areas of unstable equilibrium when the market is preparing for a reversal.
Setting up the trading terminal
The signals of the 3 indicators used hold the same value. Therefore, it is necessary to enter the market only if all the tools show the same picture. To do this, they need to be set up in a convenient manner so that you can instantly assess the situation on the market. Trading on second time frames requires a good reaction rate. The optimal values of trade expiration for the «Vision» strategy is 60 seconds. This is the minimum interval on the Binomo terminal (site). The time frame should be 5 seconds. Despite such small actual time intervals, one contract takes 10-15 candles. This improves the accuracy of the signals.
- Momentum: interval – 20;
- Moving Average: interval – 50, type – time series, fill color – any contrasting color;
- CCI: interval – 20, default zone level settings.
Binomo has an adaptive terminal that allows you to adjust the scale of the chart and indicators. This is done using the mouse wheel, and fine adjustment of parameters is carried out by scrolling in the horizontal and vertical time scales where the quotes are indicated. You should adjust the chart and indicators in such a way that you can easily track entry points to the overbought and oversold states.
Trading signals on the strategy
The main focus of the trader should be on the TSMA position. When an intersection with price formations occurs, the signals of the other 2 indicators should be evaluated. If the position of the signal lines allows entry into the market, then you should buy a contract in the corresponding direction – «up» or «down».
The signal for an increase – the price bars cross the TSMA and begin to build above the line. Momentum crosses the dividing line and CCI enters the overbought state. It also works if the commodity channel index crosses the middle N/A boundary. The main thing is that all three indicators show the beginning of an uptrend – confidently moving upwards.
The signal for a decrease – the candles cross the TSMA and begin to build below the line. Confirmation of the signal is downward movement on the Momentum and CCI. If the curves of both indicators are in the oversold zone (below the middle boundary), then entry into the market on the Moving Average signal is allowed.
The desynchronization of signals is permissible if it fits into the framework of 2-5 candles. If the discrepancy in time is greater, the percentage of signal viability decreases. Pronounced trends, as a rule, lead to almost simultaneous triggering of all 3 indicators. Such signals are the most accurate.