Looking at a 24 hour chart for the euro/U.S. dollar can give you a good idea of how to trade this pair over the course of a day, but it is only a very basic look at the problem. To effectively trade the EUR/USD short term, you need to have a firm grasp on what is happening minute by minute, as well.
Top traders know that you should look at the charts for the time period below and the time period above what you intend on trading at. So, if you are looking at 15 minute trades, you should look at what’s happening on a 5 minute basis, and on a 30 minute basis. This will give you a more complete look at things and help you to more effectively create a strategy. Remember, when you trade EUR/USD as a binary option, you are making a tradeoff. You are replacing the wiggle room that you have when it comes to time with accuracy on price prediction. This tradeoff is at its most effective when there is a clear direction on the horizon. Setting the 15 minute timeframe in stone helps relieve the stress of waiting, but it only will be helpful if you are going to be accurate in your prediction of which way the asset is moving.
Technical indicators at the above and below timeframes will be helpful. Fibonacci indicators have gained a reputation for being pretty accurate with Forex day traders, and this brings a level of “self-fulfilling prophesy” with them. Because they keep working, they will continue to keep working because people know they have worked in the past. Looking at a five month trend line for the EUR/USD, you can see that it is at the top of its support line now. The 38.2% Fibonacci expression line is currently being met in the 1.0860-1.0888 area, and that means there is potential for growth. In late trading hours on Friday, this was surpassed. If the 23.6% expansion level is met at 1.0980, then even more euro growth is possible. The 14.6% expansion number then becomes possible, which is 1.1037.
Right now, the EUR/USD sits at 1.0969. The 23.6% expansion number is well within range of this and short term traders, even 15 minute traders and shorter, need to be paying attention to these long term trading indicators. If you were to just stay within your little timeframe bubble, you would never be aware of these larger indicators, and miss out on the ongoing trends. By looking outward and inward, these things become much more easily seen, and as such, you are giving yourself a very easy way to improve your correct trade rate with your binary options. Or, if you are a traditional Forex trader, you are going to find that your entry and exit points become more accurate, thus increasing your profitability in that way, too. The bottom line is, looking beyond what you are used to can help you to make more money.
Another thing to consider is that your current way of looking at an asset may not be the best way. At least, by itself. When you take your current strategy and supplement it with others, your accuracy will improve if those new strategies (and your old one) are beneficial. By looking at other methods, like what’s discussed here, you can see if there are better ways to approach your trades, and ensure that your old methods are still doing what you want and expect them to do.
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