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Binary Options Scalping Techniques

Binary Options Scalping Techniques

Scalping techniques for successful binary options trading

Scalping is a trading style based on quick momentum trades triggered by order flow reading setups. Most scalping tactics use either indicators or price action or a combination of both.

Rapid Fire and Piranha are two of the widely employed scalping strategies by Forex traders and due to their nature they could be easily implemented in Binary options speed trading platforms – 60 seconds, 90 seconds or 120 seconds.

The two scalping techniques discussed here are developed on the M1 (1-minute) and M5 (5-minute) charts. Although scalping can be really exciting as it offers a dynamic and fast trading, it could also lead to rise of fatigue and loss of focus.

Hence you need to know when to take a break. A daily target could prevent your account from substantial losses. So before start trading, you should always set a predetermined volume of trades and once you reach that number you simple need to stop trading and call it a day. You must be equipped with at least basic money management or your money will be  easily blown away.

Rapid-Fire Scalping Technique

The rapid-fire strategy was designed with two criteria in mind:

  • The most liquid currency pair in the world – EUR/USD.
  • The lowest time frame available – 1-minute.

The M1 time fame is the perfect set for speed trading in Binary Options. Each candle is a potential trade and here you can learn when and how to enter a 60 seconds option. The rapid-fire strategy employs two indicators to assist you in spotting the objective trades throughout the day. You can then fire off the trade rapidly once you decide to take it.

Strategy setup:

1. Set your Graph on 1-minute time frame:
 
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2. Drag and drop the Parabolic SAR indicator with default setting:
 
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3. Drag and Drop the Simple Moving Average (SMA) indicator, period 60, and apply to close.
 
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4. The Strategy is designed for the EUR/USD, the most traded currency pair in the world.

Strategy concept:

The strategy concept is a trend-scalping strategy, which means it works best in a trend. The technique combines two trend indicators, SMA 60 and Parabolic SAR.
The SMA 60 is used to identify the direction of the momentum. This means that we look for Up/Call when the price is above the SMA 60 and we look for Down/Put when the price is below the SMA 60.

The Parabolic SAR is used to give the exact entry signal for both long and short positions. When the price for EUR/USD goes above the Parabolic SAR, we fire off a Up/Call position. When the price for EUR/USD goes below the Parabolic SAR, we fire off a Down/Put trade.

Up/Call trade setup

  • Look for the market price to go above the SMA 60.
  • Once the market price goes above the Parabolic SAR, the Parabolic SAR will appear below the market price. This is a signal to execute an Up/Call position.

 
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Parabolic SAR appears bellow the market price, while the SMA 60 is crossing and goes below the market price as well.

 

Down/Put trade setup

  1. Look for the market price to go above the SMA 60.
  2. Once the market price goes below the Parabolic SAR, the Parabolic SAR will appear above the market price. This is a signal to enter for Down/Put trade.

 
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Parabolic SAR and SMA 60 appearing above the market price.

 

Piranha Scalping Technique

The market spends most if it’s time either in trend or in range. While rapid-fire strategy works best in a trend, the Piranha technique must be employed when the market is in range.
This strategy is designed specifically for the GBP/USD currency pair, using the 5-minute time frame. Since the strategy is based on a higher time frame, it works better for options that expire after 5-10 minutes.

Strategy setup:

1.Set your Graph on 5-minute time frame:
 

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2.The indicator for this strategy is Bollinger Bands with Period 12, Shift 0, Deviation 2(default) as settings.
 

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3.The technique is suitable for GBP/USD currency pair.

 

Strategy Concept:

Bollinger Bands are used to identify the trading band of the GBP/USD. The Bands help us to mimic the nature of the piranhas by giving objective entries for Up/Call and Down/Put trades. Up/Call trades are taken when market prices touch the bottom band;

Down/Put trades are taken when market prices touch the upper band.
To prevent yourself from unexpected market fluctuations, avoid trading this strategy at times of major news releases during the U.S. and U.K. trading hours, as such environments reflect the rough open seas with strong currents and waves.

Up/Call trade setup.

  • Wait for the market to touch the lower band of the Bollinger Bands.
  • Enter Up/Call trade when the market touches the lower band of the indicator.

 

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Down/Put trade setup

  • Wait for the market to touch the upper band of the Bollinger Bands.
  • Enter for Down/Put trade when the market touches the upper band of the indicator.

 

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