Binary options trading using the explosion of the CCI

Binary options trading using the explosion of the CCI

Binary options trading using the explosion of the CCI. This approach capitalizes on trend momentum and has been fine-tuned for shorter time frames, making adjustments to indicators and introducing a 6-period moving average. Its versatility extends to scalping on 240-minute, daily, and weekly candlesticks.

Key Components of the Strategy

Time frames: 1 min, 5 min, 15 min.

Applicable to any currency pair.

Indicators utilized:

Commodity Channel Index (CCI) with a 21-period setting.

Buy Signal: CCI crossing above +50; Sell Signal: CCI crossing below -50.

Simple Moving Average (SMA) with a 21-period setting for high and low prices.

Moving Average (MA) with a 6-period setting for median values.

Strategy rules

Buy Signal

Criteria: CCI crosses above +50, current price above 21-period high SMA, median of last 6 periods above 21-period high SMA.

Action: Initiate a CALL (up) binary option trade.

Consider re-entry with same conditions upon formation and rebound of bullish Doji, bullish Hammer, or Dragonfly Doji off the moving average.

Sell Signal

Criteria: CCI crosses below -50, current price below 21-period low SMA, median of last 6 periods below 21-period low SMA.

Action: Enter a PUT (down) binary option trade.

Re-enter under identical conditions when a bearish Doji, bearish Hammer, or Graveston Doji forms and bounces off the moving average.

Note: Avoid trading when price significantly deviates from the 6-day average.

Expiry Time

Tailor expiry time according to the trading timeframe, typically 1 to 5 candles.

Money Management

Implement sound risk management practices, such as risking only a small portion of trading capital per trade or employing the Masaniello 30-step method.

Confirmation

Use the moving average (MA) as an additional confirmation tool to validate signals and enhance strategy reliability.

Conclusion

This strategy offers various entries into the market, initially focusing on specific candlestick formations like bullish/bearish Hammers, then expanding to include Dojis. It is best suited for time frames of 1 minute and above.

Scalping on Single Daily Candle

The strategy outlined above is adaptable for single candle scalping, with stops set at previous swing highs/lows and a target profit-to-stop loss ratio of 1:1.

Caution: In daily time frames, the moving average serves solely as a re-entry filter for defined candlestick formations. Avoid entering trades when momentum is declining.

Examples