Money Heist Binary StrategyOverview:
This is a strategy for binary traders to help with finding strong entry points that go with the trend and market sentiment. It can be used on any broker that options turbo trading (not recommending nor am I affiliated with any specific broker).
The purpose of using this strategy with these indicators is to help traders with finding entry points going with the trend each and every trade. In order to maximize efficiency with this strategy, I have developed a guideline on how I personally use it to find entry points.
NOTE - This strategy works on any time frame. Trade length will be the time frame used for analysis. Eg; Analysis on M5 = 5 minute trades. If you are using a broker with the rollover feature, use a maximum of 2 rollovers only. If you are taking 5 minute trades, 2 rollovers will provide you a 20 minute trade which is more than enough.
How Traders Can Benefit From Using This Strategy:
As traders, we all know the basic fundamental of trading is to always trade with the trend. However, with binary options, it seems traders can be enticed to focus on reversals against the trend. This can lead to developing bad habits in the market which I personally believe can easily be prevented.
Traders can use this strategy to trade with the trend by using a combination of indicators that are shown on the chart.
Indicators Used on the Chart:
As you can see, I am using 3 different exponential moving averages on the chart. Complimenting my EMA's are a Call or a Put arrow that appear with each candle. On the bottom panel, we can see that the RSI is being used alongside a currency strength meter to help identify which currency is stronger.
How the Strategy Works:
We begin by first looking at the 3 EMA's on the chart. They serve the purpose of identifying which trend the market is in. In a downtrend, we can see that the EMA's are facing downward while in a uptrend, they are facing upward. A simple technique to identifying the trend using the EMA's
is to color code them. In a down trend, the purple EMA will be the highest followed by the red and then the green. In an uptrend, the purple EMA will be the lowest with the red on top and the green at the highest. You can use this technique to identify which general trend the market is flowing in.
Not only do EMA's serve the purpose of helping traders identify which trend we are in, they can also act as a moving support or resistance area. When we are in an up trend, the EMA's can act as a moving support - meaning traders can use their price points to take CALL setups. When we are in a downtrend,
the EMA's can act as a moving resistance.
Next up, we have the RSI located on the bottom panel. As you can see, my use of the RSI is very different than the traditional overbought/oversold style of use. I use the RSI to identify whether there is more bullish or bearish strength.
To do this, the RSI has been divided into two zones using a dashed line. If the RSI is within the top zone, consider the buying pressure of the market stronger and look for call setups. If the RSI is within the bottom zone, consider put setups since there is a stronger sellers pressure. The closer the RSI is to the dashed line, the greater the probability of a consolidation or ranging market.
You can also see that there is a currency strength meter located within the labels on right axis. I use the currency strength meter to identify which currency pair has more strength. For example, suppose we are looking at USDJPY. If USD is greater than JPY, its a possibility that the currency pair as a whole is going on an uptrend. If JPY is greater than USD, it is a possibility that the currency pair as a whole is going on a down trend.
The call/put arrows that appear on the chart are not necessary for you to use but it is recommended. I personally coded the arrow to appear with each candle based on the OHLC values. A substitute indicator for the arrow is a script called "Binary_Blast_v3" coded by author Pipizer! (We thank you for coding this!)
My variation of the arrow also provides me a suggested entry price for calls and puts based on previous candle close and depending on which arrow has appeared.
How to Apply This Strategy:
When the EMA's are lined up and indicate a downtrend, look for a Put arrow (optional but highly recommended), look for the RSI in bottom zone, ensure second currency is stronger than first in the currency meter. You may also use EMA's as extra entry points.
When the EMA's are lined up and indicate a uptrend, look for a Call arrow (optional but highly recommended), look for the RSI in top zone, ensure first currency is stronger than second in the currency meter. You may also use EMA's as extra entry points.
I personally have developed a points system for traders to use incase the strategy becomes confusing.
Points System:
2 points = Not Enough to Enter
3 points = Acceptable trade setup
4 points = Good trade setup
5 points = Great trade setup
6 points = Excellent trade setup
To find a setup for a Call:
Call arrow = 1 point
RSI in top zone = +/- 1 point
Currency meter showing first stronger than second = +/- 1 point
Price at green EMA = +1 point
Price at red EMA = +1 point
Price at Purple EMA = +1 point
To find a setup for a Put:
Put arrow = 1 point
RSI in bottom zone = +/- 1 point
Currency meter showing second stronger than first = +/- 1 point
Price at green EMA = +1 point
Price at red EMA = +1 point
Price at Purple EMA = +1 point
*NOTE* The RSI and Currency Strength Meter are indicators which you must add or remove a point depending on if they favor your setup or not.
Remember, indicators work after price action. Use Price action to identify your support and resistance zones then use the indicators as extra confirmations to help you.
For any questions, please feel free to message me for help.
