Option Trading Strategy: Half Period

Two years of trading strategy: half a period brought one trader $75,000. The secret of the strategy is to use different periodic moving averages and an auxiliary MACD indicator.

This approach generates a forecast for any underlying asset and brings at least 80% option contracts with a profitable result. This material will describe in detail all aspects of the application of the strategy.

Conditions for applying a trading strategy in practice

For effective work on the half-period strategy, it is necessary to have at your disposal some technical capabilities of the trading platform. It is about using technical indicators that generate trading signals and trading conditions with which we can manage risk and capital.

For a beginner, we can recommend FinMax broker platform, it is the best broker today with an advanced web platform. At finmax the initial deposit is only 100 dollars or 6000 rubles, and the amount of one investment in the option is 300 rubles or 5$.

Setting indicators

Let's start setting up indicators and consider trading signals. The “Half Period” trading strategy is so named because it uses two exponential moving averages, the period of which differs by exactly half.

So, we set moving averages with periods of 10 and 5 — of the Exponential type, for convenience, color the indicator movings in different colors, and also apply the MACD indicator with a signal period of 15 to the chart. As a result, the screen will look like this:

The beauty of the strategy lies in the fact that by changing the settings of the indicators, we can adjust the pace of binary options trading.

By increasing the period of moving averages, you can use longer trending fluctuations in quotes to draw up contracts.

For this reason, the half-period trading strategy becomes universal and fits any asset for binary options trading!

Trading Rules

Signal to buy an option CALL:

1. The blue MA line (moving average) with a period of 5 crossed up the MA line with a red color;
2. On the MACD indicator, the histogram bars rose above the zero level of the scale.

Signal to buy an option PUT:

1. The blue MA line with a period of 5 crossed down the MA line with a red color;
2. On the MACD indicator, the histogram bars fell below the zero level of the scale.

Such periods of moving averages indicate changes in the direction of short-term trends and allow you to make profits at a high pace.

The MACD indicator allows you to evaluate the strength of a new trend and gives a confirming signal for binary options trading.

This combination of indicators and their settings shows the most effective indicators and allows you to do scalping.

Expiration time

Specifically, for such periods of building indicators, it is necessary to set the expiration time to 60-120 seconds. When increasing the construction periods, you should use a period step of 5 units, respectively, the contract expiration time will increase with each step by 120 seconds.

Money management

For trading according to the half-period strategy with broker contracts FinMax, the cost of which is $ 51, you can increase the degree of risk up to 3% of the amount of managed funds.

As already mentioned, such a trading system, as well as simple money management rules and a Finmax broker, made it possible to receive more than 70 thousand dollars in profit in just two years, which is an excellent indicator of binary options trading.

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