Investing in binary options without adopting a valid trading strategy is a real suicide. In such case it would be better to play online casino, which surely offers higher payouts. Everything changes if you do binary trading with a good strategy. One of the more valid strategies, in my opinion, is based on the publishing of Forex economic data. With this strategy, taken from one of the best Italian web sites concerning binary options, that I will describe later, you needn’t to make predictions, it’s sufficient to profit by Forex macroeconomic data as soon as they are published on the economic calendar. The sense of timing in this strategy is essential, so let’s use 24option as broker for binary options, which allows to open a position in a short time, in order to fully profit by the trend that you decided to follow.
How can we invest with the strategy of Forex economic data?
First of all we need a Forex economic calendar. Every day we must select in the calendar the three bulls news to follow. Then we note down date, hour and currency that will suffer more due to the economic news.
Hint: the three bulls economic news that are isolated in a particular hour are the ones that function better with this strategy.
What should we do once the Forex indicator is published?
As soon as possible (a few seconds) we invest downward or upward, depending on the result published, with 5 minutes expiration.
In order to better understand when we should invest downward or upward, let’s see the following example:
In the photo we selected for 10.30 p.m. of the 7th of February 2014 the NonFarm Payrolls indicator for USA market, that is a very important three bulls indicator.
The previous value was 75k and the expected one was 185k. The result was 113k, lower than expectations and so penalizing for the USD currency.
In this case as soon as the datum 113k was published, we invested upward on one of the following Forex couples: EUR/USD or GBP/USD, in which USD appears as denominator. Otherwise we could invest downward on the Forex couple USD/JPY in which USD appears as numerator.
This image shows the result “in the money” of our investment with this strategy. I placed the light blue arrow upward to show our upward entrance, which happened a few seconds after the publishing of Nonfarm Payrolls economic indicator. The candlestick graph is set with a 5 minutes time-frame.
Which scenarios can we have after the publishing of a Forex economic indicator?
▪ If the economic indicator published is exactly the same to the one that the experts expected we don’t invest (NO trading).
▪ If the Forex economic indicator published is better than expected for the relevant currency:
▪ if we invest on a couple in which the interested currency is the numerator, we open an upward position with 5 minutes expiration;
▪ if we invest on a couple in which the interested currency is the denominator, we open a downward position with 5 minutes expiration;
▪ If the Forex economic indicator published is worse than expected for the relevant currency:
▪ if we invest on a couple in which the interested currency is the numerator, we open a downward position with 5 minutes expiration;
▪ if we invest on a couple in which the interested currency is the denominator, we open an upward position with 5 minutes expiration;
In our example, the published result was worse than expected so, as we already told, we opened an upward position with 5 minutes expiration for the Forex couple EUR/USD.
Why do we choose a 5 minutes expiration?
We choose a 300 seconds expiration because we saw that in the first 600 or even 120 seconds there can be rebounds that could make our strategy vain. 10 minutes are too many, so the best compromise we found is the one proposed by 24option: 300 seconds, that is 5 minutes.
Further considerations about the strategy
We don’t recommend to invest during the speeches of banks presidents because in such period the prices suffer great rebounds depending on the sentences of the president. So, DON’T trade during speeches.
In this page I explained you the strategy I adopt to profit by Forex economic data and that is giving me great satisfactions, but it’s only a strategy, so if you decide to follow it, it’s at your peril.