Pivot Points is a binary options strategy that, when used skillfully, provides good earning opportunities. And this despite the fact that it is not difficult to use it, although the name is intricate.
Pivot points are pivot points. That is, if there was a bearish trend in the market, and it changes to a bullish one, then the moment, the point when one trend changes to another, is the Pivot point.
The Pivot Point Options Strategy determines the moment the price direction changes, forming an accurate signal to buy or sell an option.
What does the Pivot point give to a trader?
This binary options strategy is used by traders, banks and other financial institutions that make money on fluctuations in the exchange rate and stocks. Pivot points are used in many binary strategies because of the accuracy of determining support and resistance lines. By determining the general direction of the asset’s movement, traders can determine the change in price direction with a high percentage of probability, as well as receive an accurate signal.
Financial institutions use pivot points to determine the mood of traders.
How to use the Pivot Point strategy?
To begin with, pay attention to the table in which you can see the classic pivot points:
- S (support) is the designation of support levels
- R (resistance) is the designation of resistance levels
- The Pivot Point is the main pivot point, which is also the target of the asset price
- In the table, you can select any asset for trading. By clicking on the group, you will see a complete list of assets
Trading on the Pivot Strategy: Step-by-Step Instructions
Step 1: Choose an asset
The table shows the Pivot points for currency pairs, stocks, commodities. Choose the asset that suits you. Traders can choose stocks, futures, currencies, and commodities. We prefer to work with currency pairs. They have a large amplitude, show better results and give frequent trading signals.
Step 2: Determine the time interval
Pivot points indicate a certain time interval. For example, for 1 minute, 5, 15, 30 minutes, 1 hour, 1 day, 1 month. You choose the interval yourself, just click on the interval that suits you.
For the strategy, choose 5 minutes. We also configure the parameters of the broker:
Click on the drop-down menu and you will have expiration options from 1 minute to a month.
Step 3: Select the asset and interval from the broker
After you have decided on the asset and interval, go to the broker’s platform. There we select the same interval as in the table.
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Step 4: Opening a trade according to the strategy
Pivot point – determines the level to which we strive for the price of an asset. It is also customary to call it the price target. S – these support levels are valuable. Pushing off from them, the price will move towards the Pivot level.
Buying an option to increase the CALL
If at the moment the price of the asset is lower than or equal to the Pivot point indicated in the table, then we buy a CALL option for “Increase”. If the price is lower, it should bounce off the support line and head towards the Pivot level.
If the price of the asset is higher than the pivot point indicated in the table, then skip the option.
To determine the points, use the method of classical pivot points.
Strategy testing and results
In the Pivot points table, define the levels. Based on them, we will conclude transactions for the purchase of a CALL option. If you prefer to work with currencies, you can choose assets: USD/JPY, GBP/USD, EUR/USD In the figure you can see all the Pivot levels.
Having determined that the price is below the Pivot Points, you can open bull trades (purchase of a CALL option). Intervals for trading: 5 minutes.
The result of trading is all three trades in plus, $ 216.
Our result for the pivot point options strategy for 2 weeks was 83%.
By trading binary options with a pivot point strategy, you get accurate signals. By correctly identifying trends, we get an average statistics of 83% of positive trades over 2 business weeks, which indicates the effectiveness and accuracy of the strategy.
Pivot Point Strategy at Olympus Trade
For effective work on the Pivot strategy, we recommend choosing the terminal of a trusted broker Olympus Trade, which is one of the most convenient and functional in trading. The broker’s trading platform has the necessary functionality for work: a personal account, convenient analytics, an expanded set of indicators, market reviews and an economic calendar.
The main working space of the terminal allows you to use indicators for technical analysis: MA, Parabolic SAR, MACD, RSI, Stochastic and Bollinger bands, select expiration (from a minute to an hour), use a live chart, test strategies. You can get acquainted with the current reviews about the broker Olympus Trade, as well as ask a question to traders, here. You can see what the terminal workspace looks like in the image below.
A detailed review of the Olymp Trade broker is here.
Go to the official website of the broker Olymp Trade here.
In order to buy a CALL option in the Olymp Trade trading terminal, follow these steps by going to the olymptrade.com website and preparing an option, indicating:
- Type of asset
- Expiration
- The size of the bet
- Forecast of quote movement: UP
- Click the “buy” button and follow the results.
In order to buy a PCI option in the Olymp Trade trading terminal, follow these steps by going to the olymptrade.com website and preparing the option, indicating:
- Type of asset
- Expiration
- The size of the bet
- Forecast of quote movement: DOWN
- Click the “buy” button and follow the results.
Start trading with Olympus Trade
Read reviews about Olympus Trade
Bonuses of the broker Olymp Trade
Working with Olymp Trade is profitable, the broker often holds promotions and bonuses for users. The advantage of such bonuses is that it is profitable and reliable, such additional funds will expand opportunities and increase the chances of earning good money without investing personal funds in trading.
Now the broker offers a profitable starting bonus to newcomers to the platform, which will double the bonus amount. The size of the bonus will depend on the amount of the deposit made (according to the terms of the bonus funds), which you deposited into your account within an hour after registering on the site.
Inference:
Both professionals and novice traders can work on the Pivot Point strategy. By correctly identifying the points, the trader will receive fast and accurate signals. Pivot points are trend reversal points in the opposite direction. In this case, there is only one trading option – to buy an option to “increase” if the price of the asset is lower than or equal to the value of the Pivot Point. Proper use of this binary options strategy will allow you to make good money.
To work on the strategy, choose a reliable broker, study the current ratings of brokers according to traders .
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Tagged with: Binary Options Strategy
