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@  kalc : (02 July 2020 - 09:04 AM) trading has made me fat anyway TP ha ha
@  traderpusa : (02 July 2020 - 06:52 AM) @kalc, getting more fat every day under quarantine lol
@  kalc : (02 July 2020 - 04:01 AM) and by the way if that guy trys to sell you stuff dont buy it, he's just ripped off some indi's over at forex-station lol its all freely available
@  kalc : (02 July 2020 - 04:00 AM) lol hey TP hows it going young man
@  traderpusa : (01 July 2020 - 01:53 PM) So is the market lol
@  David : (30 June 2020 - 08:00 AM) yall are savage :D
@  David : (30 June 2020 - 08:00 AM) haha
@  Sambo : (29 June 2020 - 05:04 PM) If there's one thing i've learned, it's that the most profitable traders are the least boastful.
@  happyjas : (27 June 2020 - 09:50 PM) We understand what took place, you won a lot of money and bought a new "BMW M4 cake", you got down on your knees, put your little hands together and sounded like this: "My name is my name, if you ask me again I'll tell you the same, I won a lot of money, and already shove it on my candy back-end, but there's one problem, everyone knows already that I ABSOLUTELY SUCK."
@  happyjas : (26 June 2020 - 05:43 PM) the R8 Audi thing -_-
@  happyjas : (26 June 2020 - 05:42 PM) :unsure: 'Can't afford the BM thing, 'just got the 2018 Audi 2016 :(
@  happyjas : (26 June 2020 - 05:41 PM) :unsure: 'Ca
@  Dyabolus : (26 June 2020 - 03:45 AM) so were u verified by David at last? how about that 'pic'
@  David : (25 June 2020 - 04:48 PM) sure post a pic
@  euro_rapp : (25 June 2020 - 04:17 PM) sorry im bragging again, i sincerly apologize. Just wanted to share with you :(
@  euro_rapp : (25 June 2020 - 04:13 PM) By the way do you wanna see my new BMW M4?
@  euro_rapp : (25 June 2020 - 04:13 PM) where do you read that closure stuff?
@  happyjas : (25 June 2020 - 07:45 AM) thanks anyways MAster David, a million times :)
@  happyjas : (25 June 2020 - 07:41 AM) *closure
@  happyjas : (25 June 2020 - 07:39 AM) feeling anxious about what I read about BOE (the enclosure, i guess) :(

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Ultimate Price Action


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#1 charlesl

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Posted 05 August 2014 - 06:24 AM

Disclaimer:  This is an idea which is not fully baked.  Also, the thread title has nothing to do with what most people mean when they say "Price Action".  Nevertheless, I think it is appropriate because the idea is based solely on the prices of NADEX binary contracts.

 

The essential idea:  NADEX binaries on currencies expire at the top of the hour.  30 minutes before expiry we will examine the prices of the NADEX binary contracts on EUR/USD, GBP/USD, AUD/USD, USD/JPY, and EUR/JPY (why just those?  Don't know, but that is what I am focusing on at the moment; remember the idea is not fully baked).  We identify contracts which have a Bid of $80 or higher and those which have an Offer of $20 or lower.  The market is saying that a contract with a Bid of $80 or higher is most likely going to finish in the money.  It is also saying that a contract with an Offer of $20 or higher is most likely going to finish out of the money.  We think the market is correct.  However, we aren't going to risk $80 to find out.  Instead, we wait for a pullback in the price of the $80 contract to $50 so we can BUY it.  Further, we wait for an increase in the price of the $20 contract to $50 so we can SELL it.  We can setup up our orders ahead of time.  So, for the $80 contract, we put in our order to buy at $50.  It will sit in our Working Orders until the contract comes down to our level and we get filled.  Or for the $20 contract, we put in our order to SELL at $50.  Again, it just sits there until the price rises enough for us to get filled.  After we have our orders set up, we just wait.  At 5 minutes until expiry, we CANCEL ALL OPEN ORDERS.  If the order hasn't been filled by then, then we don't want it to be filled because by the time it does, the underlying currency may not have time to reverse its direction in time for us to be profitable.

 

It is easy to identify potential trades just by looking at the Bid/Ask prices of the contracts, but on the mobile platform the charts of the contract price can be consulted as well.  Here's an example:

 

janqtlw.png

 

On this chart which is a screenshot of the NADEX app on my Android phone, I have marked with arrows the time showing the :30 minute mark, the point on the line graph showing the price of the contract and the price on the Y axis on the right.  You can see that this contract was trading with a Bid/Ask midpoint above $80 at the time I did the screenshot.  It is for GBP/USD > 1.6864.  So, based on what I have laid out above, for this contract we would put in an order to BUY the contract at $50.

 

In the case of the contract in this chart, the order was never filled because the price did not move down enough before the :55 minute.  So, I just canceled the order according to the rule.  That is what is going to happen most of the time.  None of the orders will be filled.  And you will have to cancel at the :55 minute.  However, you sometimes will get filled and when you do, the expectation is that you'll be showing a loss for a little while in the position but in the end, you expect the underlying currency to reverse and you finish with a profitable trade.

 

I think the time to trade this is probably between 7AM and 3PM when the markets in the US are most active.

 

What I like about it is that it depends only on the "price action" of the contracts.  There's no indicators and charts.  The only chart I would use is like the one shown above which graphs  the price of the contract not the level of the currency.  This is why I have borrowed the "Price Action" term so many people are fond of.  My apologies if you price action lovers feel I have co-opted your terminology and misused it.



#2 charlesl

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Posted 05 August 2014 - 05:08 PM

Here's an example chart captured from my phone(the desktop platform doesn't seem to have these charts of contract prices anymore, don't know why).  This is what we are trying to capture with this strategy.  The contract was trading around $90 at the :30 mark.  But, descended in price to $50 before expiration thus creating a buying opportunity according to the rules.

 

txlOmbA.png



#3 Singh

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Posted 05 August 2014 - 05:16 PM

good idea very risky too and very rare to get as well......will try it on demo tho

 

 

Singh


"The game taught me the game. And it didn’t spare me rod while teaching."
- Jesse Livermore

 

My Youtube channel for trading videos -  https://www.youtube....user/mindpl4y3r


#4 charlesl

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Posted 05 August 2014 - 05:24 PM

good idea very risky too and very rare to get as well......will try it on demo tho

 

 

Singh

 

More than the question of how rare it is, I think the real question is when it does happen, is there a quick reversal leading to an in-the-money expiry, or does it just keep going leading to an out-of-the-money expiry.  The answer to that determines whether this makes money or not.



#5 Singh

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Posted 05 August 2014 - 05:29 PM

well thats where we have to think outside the straddle and actuallly take help of Price Action find support/ressitance on chart watch indiicators like ichimoku those things could help us in finding the answer to your question.

 

 

 

Singh


"The game taught me the game. And it didn’t spare me rod while teaching."
- Jesse Livermore

 

My Youtube channel for trading videos -  https://www.youtube....user/mindpl4y3r


#6 charlesl

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Posted 05 August 2014 - 05:31 PM

well thats where we have to think outside the straddle and actuallly take help of Price Action find support/ressitance on chart watch indiicators like ichimoku those things could help us in finding the answer to your question.

 

 

 

Singh

 

No way!!!!  Indicators?  IchiMokus?  That is the exact opposite of what we are trying to achieve here.  We don't want to use anything but the price of the contract.  This is all about price action.  If we start using indicators, then this whole idea is just like all the other strategies on here.  This idea of using only the contract price is "out of the box" thinking.



#7 Singh

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Posted 05 August 2014 - 05:34 PM

well getting help from those indis and regular price actionn dont hurt but increase your chances and if not then qquestion stands how we know if price going to reverse or keep going? answer is we dont know and thats called gamble not trading and as far as i remember you only takes trades with high outcome in your favour so i guess you will never take this kind of trade as you dont know the outcome and if you wont take this trade then why even think about it and if stiill think about it then whhy dont consider regular price action and some indis to favour your decision?  what u say?

 

 

Singh


"The game taught me the game. And it didn’t spare me rod while teaching."
- Jesse Livermore

 

My Youtube channel for trading videos -  https://www.youtube....user/mindpl4y3r


#8 Singh

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Posted 05 August 2014 - 05:39 PM

btw what you think about trade balance news tmrw?

 

 

Singh


"The game taught me the game. And it didn’t spare me rod while teaching."
- Jesse Livermore

 

My Youtube channel for trading videos -  https://www.youtube....user/mindpl4y3r


#9 charlesl

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Posted 05 August 2014 - 05:45 PM

well getting help from those indis and regular price actionn dont hurt but increase your chances and if not then qquestion stands how we know if price going to reverse or keep going? answer is we dont know and thats called gamble not trading and as far as i remember you only takes trades with high outcome in your favour so i guess you will never take this kind of trade as you dont know the outcome and if you wont take this trade then why even think about it and if stiill think about it then whhy dont consider regular price action and some indis to favour your decision?  what u say?

 

 

Singh

 

Here's my thesis:  The market price at $80 or higher on an in the money contract with 30 minutes or less to go is exactly right.  It is telling me that the contract has an 80-percent chance of finishing in-the-money.  However, there is also randomness in the market.  So, sometimes what looks like a sure thing is affected on a short term basis by all kinds of factors.  In the end however, normalcy will return to the market and the short anomaly will give way to a more orderly expiry.

 

I don't know whether this thesis is correct or not.  If I could, I would just use a dataset with NADEX contract prices for all currency instruments on a second by second basis to test out my theory.  To the best of my knowledge, such a dataset does not exist.  I don't have it.  So, how am I going to test my hypothesis?  The only way I see to test it is to actually do it.

 

I absolutely will not add any indicators to the idea.  Again, that defeats the whole point.  I am just relying on the market's underlying wisdom with 30 minutes left to guide me to a successful trade.  

 

If this strategy turns out to be a dog, I'll be the first to admit it.  But, I just don't see any other way to tell if it is a dog or not other than by trying it.



#10 charlesl

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Posted 05 August 2014 - 05:46 PM

btw what you think about trade balance news tmrw?

 

 

Singh

Let's not pollute this thread with talk about news.  That's for the other thread.



#11 charlesl

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Posted 06 August 2014 - 03:09 PM

I monitored the market beginning from 8:30AM EST to 1:55PM EST and entered the trades according to the rules.  

 

VdjKwMU.png

 

+ $450 ( 4 wins/ 2 losses = 66 % Wins)



#12 Singh

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Posted 06 August 2014 - 03:16 PM

not bad at all charles.....u r onto making something new...lets see how it folds...

 

 

 

Singh


"The game taught me the game. And it didn’t spare me rod while teaching."
- Jesse Livermore

 

My Youtube channel for trading videos -  https://www.youtube....user/mindpl4y3r


#13 charlesl

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Posted 15 August 2014 - 05:13 PM

Three wins and three losses:

 

vpZGr8K.png

 

- $9

 

On a lesser platform, a 50-percent win ratio would lead to a bigger loss given the payout is perhaps as little as 70 percent.  On NADEX, you can structure your trade for a much better reward (for example by buying or selling at $50) and therefore, only winning 50 percent of the time results in a small loss (whereby the loss is caused only by trading fees paid to the exchange).  In fact, trades can be structured so that you can win less than 50 percent of the time and actually be profitable even if all trades are bought/sold at the same amount.  For example, let's say you take 3 trades.  In each case you buy a contract for $20.  Only 1 trade out of the three wins.  You still are profitable at only a 33 percent win percentage.  



#14 charlesl

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Posted 18 August 2014 - 07:02 PM

1 win, 2 losses.  Tweaked my entries to $48 on a buy and $52 on a sell.  Why? Consider the math on the buy side.  I buy 1 contract for $48.  I pay a $1 trade fee = $49 total risk.  If I win, I get back $100 - $1 settlement fee = $99.  So my profit is $99 - $49 = $50.  The math works out exactly the same on a sell at $52.

 

 Now, suppose I take 2 trades on the day.  The first I win and get $50 in profit.  The second I lose.  So, my $49 in risk is a total loss.  My profit/loss for the day:  = $50 (profit for the win) - $49 (total loss on the loser) = $1 profit on the day.  So, in this scenario, I had a 50 percent win ratio and I still made $1 profit.  Try that on a lesser platform!

 

Anyway, here's the trades for today:

 

prMCNcS.png

 

- $48



#15 charlesl

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Posted 19 August 2014 - 06:13 PM

4 wins, 2 losses

 

XQ1CMcI.png

 

+ $102



#16 charlesl

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Posted 20 August 2014 - 10:24 PM

I didn't trade UPA every hour.  However, watching the price action in the contracts has made me think of two things.  The first is that there is an awful lot of contracts that offer what Darrel Martin of apexinvesting.net calls "premium collection" opportunities.  Since UPA is focused on contracts that are priced at $20 or $80 each hour on the half-hour, after you place your orders at $48/$52 and what your working orders list, you can see that the vast majority of those contracts just go right down to zero after moving around between $10 and $30 for a while.  UPA is not about premium collection, but if you watch that kind of price movement over and over again, it makes you think about going into the premium collection business.

 

The other observation is the importance of the rule that says "cancel all orders at :55".  In fact, from watching the price action, I have that idea that we can juice up UPA a bit by saying to reverse your original trade and follow the short-term trend when the underlying hits the $50 after the :55 mark.  

 

In other words, let's say that at :30 USD/JPY is trading at $20.  So, we submit our order to SELL USD/JPY at $52.  Then, time passes and at :55 our order hasn't triggered.  Maybe it is close to triggering.  Perhaps we could sell it for $40.  But, the rules say we must cancel all orders at :55.  So, we follow the rule and cancel the order.  But, we keep watching the price action.  at :57, USD/JPY can be bought for $52.  The new idea is to go ahead and buy the contract, thereby reversing our original intention which was to sell it.

 

The reason we cancel all pending orders at the :55 mark is because we think that if we get filled after :55, the market doesn't have enough time to recover and go in our favor by expiry time.  If we believe that, then why fight it?  Why not use it to our advantage and just trade in the opposite direction in the belief that the market won't have time to go against our trade before expiry.

 

I decided to try that on a USD/JPY trade.  I had my order in to short at $52.  But, at :55 I canceled the order.  I kept watching the contract though.  At the :56 mark, the Offer price went above $52.  So, I entered an order to buy at $48 thereby reversing my original trade idea.  Again, the idea was that if there was some velocity taking USD/JPY up in the last few minutes, rather than fighting it, I would just try to ride the wave up to expiry.  Well, as it turned out while I was putting my order in, the price dropped.  So, when I submitted my order to buy at $48, I got a better price of $29.  Now, that would have been a cause for alarm in one respect, because it seems like the premise of the trade was already falling apart even before I could get filled on my order.  However, as it turned out, the trade finished in the money at expiry 4 minutes later.  

 

This tweak may have some merit to it.

 

i3PI4GE.png

 

+ $345



#17 Singh

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Posted 20 August 2014 - 11:36 PM

Great Idea Charles.You allways bring something new.Thanx

 

 

Singh


"The game taught me the game. And it didn’t spare me rod while teaching."
- Jesse Livermore

 

My Youtube channel for trading videos -  https://www.youtube....user/mindpl4y3r


#18 showbizi

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Posted 21 August 2014 - 01:30 PM

Thats great thinking Charles! I would however expect the probability of trades that get filled with this strategy to be far less than those expiring in and out f the money as they depicted an hour or 30 minutes before expiry (i think you mentioned this as well). Also, if the price action seems to be reversing closer to expiry, i would rather not take a trade waiting for a reversal or pullback time being of essence here. Am I thinking on the same Plane as you are?

 

With that I was looking at historical average pip movements in currency pairs at various times of the day. I made some interesting observations and took trades on my demo account today. They were all successful and it makes me wonder if it is a smart idea to just master trading at a specific time of the day and trade the news of course when you can. 



#19 bravester10

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Posted 21 August 2014 - 03:23 PM

Thats great thinking Charles! I would however expect the probability of trades that get filled with this strategy to be far less than those expiring in and out f the money as they depicted an hour or 30 minutes before expiry (i think you mentioned this as well). Also, if the price action seems to be reversing closer to expiry, i would rather not take a trade waiting for a reversal or pullback time being of essence here. Am I thinking on the same Plane as you are?

 

With that I was looking at historical average pip movements in currency pairs at various times of the day. I made some interesting observations and took trades on my demo account today. They were all successful and it makes me wonder if it is a smart idea to just master trading at a specific time of the day and trade the news of course when you can. 

 

That is an excellent idea. I have thought of that as well in the past, just never got to do much about it. For example, you could look at the market opening hours, ex: 3 to 4 AM ET when there is increased volume and voltaility.. then you could straddle that. On the other side, you could look at the slow hours (5-8 PM ET or even earlier than that) to do Strangles or premium collection trades.



#20 showbizi

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Posted 21 August 2014 - 03:37 PM

That is an excellent idea. I have thought of that as well in the past, just never got to do much about it. For example, you could look at the market opening hours, ex: 3 to 4 AM ET when there is increased volume and voltaility.. then you could straddle that. On the other side, you could look at the slow hours (5-8 PM ET or even earlier than that) to do Strangles or premium collection trades.

Yes! I noticed how there are a couple hour spans for different pairs when the market is always more or less ranging or in the correctional stage after a trend. if during those times we can establish a support and resistance and find suitable expiries based on our analysis then the probability of losing a premium collection trade goes down too. Timing is still very important to get a good price. 






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