Binary Options Binary Options Analysis - Price Action!

Hello everyone! Sorry for taking a long time between the posts but trading, writing articles, blogging and
starting a new trading and coaching service is very time consuming for me not to mention everything else in life one has to deal with.

Today I would like to talk about Price Action!
From experience I know that many many traders or wannabe traders are looking for the "ultimate" or "best Strategy". To be honest, there is no such thing as "the best strategy", there is only a good trader and analyst and a bad one.

Having said that, I still have to say that the best way to approach trading, binary options trading or trading in general is to analyze the charts and not relying solely on autotraders and indicators.
This is what takes us to what we traders call "Price Action". After all, the price is what we are interested in.
We want to know where it is going, where buyers and sellers in the market are expected to buy or sell the underlying asset. For this task, we use support and resistance lines. Support and resistance lines are basically areas on the charts where we, by looking back through chart history, can locate where price turned back down or up. If sellers sell the asset the price drops and vice versa when buyers buy an asset.
By identifying these areas you can have an idea about where price is going and how to prepare your next trade.

Take a look at the picture for example. The line I drew is from a chart on a higher timeframe which offers a more solid and trustworthy price action data. In this case, my line is a resistance line that I was expecting price to touch. I confirm this area as an "overbought" area, meaning this is where buyers stop buying and sellers enter the market to sell, hence dropping the price. As you can see, the arrow means I took a put option and the X means the trade expired in that location, resulting in a winning trade =).

 

Hi mate

This is very useful information for all. I really appreciate this.

 

Thanks, check out the other threads I made too