Moving Average Strategy

Strategy characteristics

Type:Trend.
Timeframe:Any in the range M1-M15. In our case, M1 is used, but with an increasing period of analysis, the accuracy of the signal an increasing.
Trading asset:Any currency pair. The main requirement is a fixed (2-3 points) spread and no hidden fees.
Trading time:All Forex trading sessions.
Percentage premium option:Not less than 70-75%.

Used indicators

The strategy uses three technical indicators:

  • Simple (SMA) Moving Averages. Trend indicators by which we determine the opening point of the option. The strategy is not intended for trading during flat periods. We trade only if the range is between at least 15-25 points!
  • Awesome Oscillator (AO). The oscillator should finally confirm the signals of the previous indicators. Additional signals can be obtained using intermediate levels − in this case, the Williams Magic Oscillator will also work as an indicator of overbought/oversold conditions.
  • Stochastic − the oscillator will assess the current balance between buyers and sellers: the predictor above level 80 − the end of the uptrend (overbought), below 20 − the end of the downward (oversold).

After installing the tools, the terminal’s working window looks like this:

Binary options signals:

  • CALL option. The price chart is above the Moving Average or breaks it from bottom-up. The Awesome Oscillator histogram is green, above or as close to zero as possible. Stochastic is up or out of oversold (level 20);
  • PUT option. Opposite conditions: the price is below Moving Average or breaks it from top to bottom. The Awesome Oscillator histogram is red, above or as close to zero as possible. Stochastic is down or out of overbought (level 80);

Open a trade on the next candle after trading binary signals. Time of expiration of options has to be not less than 10-15 minutes even if as a working timeframe it is chosen of minute.

Recommendations for use:

  • Novice traders should trade only binary signals at the zero crossings of the Awesome Oscillator. As you gain experience, you can use the histogram reversals up for CALL and down for PUT options;
  • Even on the minute timeframe, Stochastic rarely goes into the extreme zones and you can miss a lot of good deals. If price and Stochastic start moving in one direction − you can open an option!
  • Time of expiration can be increased up to 5-7 minutes if the steady trend is observed. Also during such periods, it is possible to open several options with different validity period to take away a maximum of the movement at minimal risk. If the broker gives the chance to close the option until expiration, then surely we fix the transaction (even if it in profit!) at the emergence of an opposite signal!
  • During the publication of important fundamental news and statistics, we do not open options 30 minutes before the news and 30 minutes after the publication; cautious traders can close current deals. To control the events, we use the economic calendar included in the all popular binary trading platform!
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