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@  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) :(
@  David : (25 June 2020 - 07:18 AM) good how about you happy?
@  happyjas : (25 June 2020 - 07:16 AM) hello MAster David, how are you?
@  David : (25 June 2020 - 06:23 AM) good morning guys
@  happyjas : (21 June 2020 - 05:09 PM) Alive and Kickin' B)

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#1 charlesl

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Posted 21 August 2014 - 04:43 PM

Let's use this thread to talk about how profit from trading on NADEX using premium collection/range trading ideas.  I don't have any ideas to kick things off but I'm sure someone does.



#2 charlesl

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Posted 21 August 2014 - 05:12 PM

Took this screenshot of the EUR/USD 8pm contract about 10 minutes after it became available for trading:

 

tkp078p.png

 

I guess the term 'strangle' means you sell the higher strike contract and buy the lower with the goal of making money if the underlying falls between the two contracts.

 

Is that a 'strangle' you would be willing to take?

 

The currency quotes to the left of the NADEX contracts are from 24option.com which I find agree almost exactly with the data NADEX is using.  In fact, the quotes from 24option.com seem more accurate than what NADEX shows on their order tickets.  As shown, EUR/USD was almost exactly in the middle of the two strikes when I took the screenshot.  This gives a good reference for how the NADEX contracts will be priced with about two hours until expiry.



#3 charlesl

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Posted 21 August 2014 - 05:18 PM

Note that if you took the strangle shown above your total risk would be $52 if 1 contract was bought and 1 was sold.  If you traded it as a strangle your risk would be $63.  

 

It seems to me that the question is, what is the probability of EUR/USD moving 2 pips or more in the next two hours?  



#4 charlesl

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Posted 21 August 2014 - 05:28 PM

The screenshot above is for 8pm contracts.  I'll try to put one up for today's 9pm contracts as well when it opens for trading.  

 

EUR/USD now has strike widths of 4 pips.  What is the probability that EUR/USD will move 4 pips between 7pm and 9pm?  Answer (based on NADEX settlement data since November 2013):

 

Up 4: 32
In : 74
Down 4: 39
 
In other words, EUR/USD finished up 4 or more pips 32 times, finished down 4 or more pips 39 times, and finished inside a 4 pip range 74 times.
 
Summary:  In the range 74/145 = 51 %;  Out of the range 71/145 = 49 %.
 
Coin flip?
 
What about an 8 pip range (so we might consider trading the next higher and lower strikes)?
 
Up 8: 17
In: 110
Down 8: 18
 
Summary:  In the range 110/145 = 76 %, Out of the range 24 %.
 
Let's say the 9pm contracts will be priced similar to the 8pm contracts shown in the screenshot above.  A 'strangle' trade is impossible based on the prices.  That leaves us with a straddle?  You would have a total risk of about $18 on that trade.  If you win you get a profit of $82.  Do you take the trade?


#5 showbizi

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Posted 21 August 2014 - 05:30 PM

Thanks for this Charles. Looking at the pricing, seems the the spot is at around 1.3280 - 81. The binary strikes are now only 4 pips apart. At this time I would not do the 'straddle' for reasons. Firstly, selling at $1 will not bring in any substantial profit unless we sell a large number of contracts and the risk:reward just doesn't seem pretty no matter how sure we are about the market movement. I could however buy the $80 but that too if the price is upward trending or at the support of then range I established. Also, In wouldn't take this trade with 2 hours to go. If I wanted it to expire itm I would take this trade with less time to go. What do you think?

#6 Singh

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Posted 21 August 2014 - 05:36 PM

how abt use strangle on gbp/usd in slow market wherd strike prices are 10pip wide.

 

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


#7 charlesl

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Posted 21 August 2014 - 05:42 PM

Here's the current situation on the 7pm contract.  As shown on the left, the EUR/USD is currently trading at 1.32805 with 18 minutes to go, price of the 1.3280 has dropped to $65.  Do you buy?  

 

R8xwF5I.png

 

 

You said two hours in advance of expiry is too early to buy.  Now, with 18 mins to go, is it safe to buy?



#8 showbizi

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Posted 21 August 2014 - 05:45 PM

Thats the thing. Finding out what time what currency pairs are dull and set our trades accordingly. It will be different at different times of the day obviously. And it will be better with wider pips for sure. Seems like with just 4 pips apart, eur/usd will provide scalping opportunities even in slow markets

#9 charlesl

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Posted 21 August 2014 - 05:46 PM

Thanks for this Charles. Looking at the pricing, seems the the spot is at around 1.3280 - 81. The binary strikes are now only 4 pips apart. At this time I would not do the 'straddle' for reasons. Firstly, selling at $1 will not bring in any substantial profit unless we sell a large number of contracts and the risk:reward just doesn't seem pretty no matter how sure we are about the market movement. I could however buy the $80 but that too if the price is upward trending or at the support of then range I established. Also, In wouldn't take this trade with 2 hours to go. If I wanted it to expire itm I would take this trade with less time to go. What do you think?

 

Well, I guess the whole question is this:  Are you lowering your risk by putting on a strangle?  Or are you in fact doubling your risk because now you have two nearby contracts in place?  In other words, is it better to just take one side of the trade or the other?  



#10 showbizi

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Posted 21 August 2014 - 05:48 PM

I wouldn't consider this safe. The price would be moving fast at this time. And if my charts indicate I have hit support with enough time left to bounce back up, only then would I consider this trade

#11 charlesl

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Posted 21 August 2014 - 05:49 PM

how abt use strangle on gbp/usd in slow market wherd strike prices are 10pip wide.

 

Singh

 

Well, going with GBP/USD may seem attractive because the width is greater.  However, keep in mind that these contracts will be priced accordingly.  There is no free lunch.  I'll take a screenshot of GBP/USD when it becomes available for trading in 11 mins.  We can see how much risk is involved.



#12 charlesl

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Posted 21 August 2014 - 05:51 PM

I wouldn't consider this safe. The price would be moving fast at this time. And if my charts indicate I have hit support with enough time left to bounce back up, only then would I consider this trade

OK, so you are relying on your chart/trading skills.  If you've got those skills, then I guess you can take any trade you want with no fear and full confidence in your skills.  I like to assume my chart/trading skills are garbage.  Then, build a strategy around that.  



#13 charlesl

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Posted 21 August 2014 - 05:52 PM

So, showbizi, you wouldn't touch the 7pm EUR/USD 3280 trade for $80, eh?  Singh, how about you?  Expires in 8 mins.....decide quickly!



#14 showbizi

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Posted 21 August 2014 - 05:53 PM

Honestly, strangles seem riskier than one sided premium collections. With premium collection trades we are hoping the price will not move enough but we still rely on price action. That being said, yes you are doubling your risk for an expectation of a smaller return.

#15 showbizi

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Posted 21 August 2014 - 05:54 PM

Yes I would given I have the price action depicting a bounce back. 8 minutes is enough time

#16 charlesl

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Posted 21 August 2014 - 05:54 PM

Honestly, strangles seem riskier than one sided premium collections. With premium collection trades we are hoping the price will not move enough but we still rely on price action. That being said, yes you are doubling your risk for an expectation of a smaller return.

Well, when one side of your strangle is losing terribly, you sure are happy for that other winning side....



#17 charlesl

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Posted 21 August 2014 - 05:55 PM

Yes I would given I have the price action depicting a bounce back. 8 minutes is enough time

So, your advice is take the trade.  I want to be clear?



#18 showbizi

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Posted 21 August 2014 - 05:57 PM

I would be clearer if I had access to a computer and charts right now. But yes, take the trade if the price is at support

#19 charlesl

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Posted 21 August 2014 - 06:01 PM

Here's the 9pm GBP/USD:

 

JyV2I6e.png

 

Take a straddle for $16 total risk?

 

Stats;
 

Up 10: 13
In : 119
Down 10: 14
 
In:  81 percent.
Out: 19 percent.


#20 Singh

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Posted 21 August 2014 - 06:03 PM

no hard for gbp usd to move 10pips at this time so no point taking a straddle.strangle would be great if strikes were available.

 

 

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





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