Although the name of the strategy presented may be unusual, the system itself is very simple and will be perfect for beginners as well as more experienced traders of Binary Options – especially in the short term, daily trading.
The name MA AO STOCHASTIC has come from three indicators used in the strategy – moving average, awesome oscillator and stochastic oscillator. We invite you to familiarize yourself with the full description of the system and its practical application.
Setting of indicators
- Moving average – change period to 12, remaining settings unchanged
- Awesome Oscillator – Runs with standard settings
- Stochastic Oscillator -% K of 12,% D and Slowing of 3.
The graph should now look like this (colors may vary depending on the user’s settings):
System rules
- Interval on chart – M5
- Expiration of option – M10-M15 (we are interested in 2nd or 3rd candle)
The strategy can also be used on smaller intervals (for example, M1). However, we will only open this option after the first or second candle after the signal candle has been drawn. Switching to the M1 interval should be considered when the system generates too few signals – in the case of one-minute graphs, the number is significantly higher.
Playing PUT options
MA must cross the body of the candle and be over following candle
Awesome Oscillator moves around 0
Stochastic is in the overbought zone (between 70-100) and goes down
When all three signals overlap, we play the PUT option with expiry equal to 2-3 candles (for the M5 graph, they will be 10-15 minute options)
Playing CALL options
MA must pass through the body of the candle and be under following candle
Awesome Oscillator moves around 0
The Stochastic is in the sold-out zone (between 0-30) and heads up
When all three signals overlap, we play the CALL option with expiry equal to 2-3 candles (for the M5 graph, they will be 10-15 minute options)
How to play PUT option – sample
The moving average crosses the body of the candle and is located over the following candle. The Awesome Oscillator moves around zero, while the Stochastic is clearly above the 70 level, but heading towards it (down). As a result, we can purchase a PUT option that expires in 15 minutes. As you can see, the candle has closed lower than the signal candle, so the transaction was successful.
How to play CALL option – sample
The moving average (MA) crosses the candle and moves under next candle. Awesome Oscillator is flat at zero, the stochastic oscillator will exit sold-out area soon (0-30). The rules of the strategy are fulfilled, so open the CALL option that expires in 15 minutes (three candles). Price closed higher than the signal candle, once again the transaction was successful.
