2013: Year of the 60 seconds trading Phenomena

When binary options were first introduced to the retail trading community, it took the financial markets by storm. Like fish to water, many traders started to switch from trading other financial instruments to trading binary options because it was simple to understand and to trade. Just when you thought it couldn’t get any more exciting, somebody then introduced the concept of trading binary options with a 60 second expiry time period.

With such a short expiry period, how does one trade such an option? Well trading 60 second options is the same as trading normal options except that you will have to react faster. Some compare the 6O seconds trading to online casino; different but does bring the same kind of adrenaline.

I would definitely say that it reminds me of the high frequency trading in any case:

What You Need For Trading 60 Second Options

Before you can start trading 60 second options, you will need to find a binary broker who offers such options for trading. Since most leading brokers that uses the SpotOption trading engine have this type of trading contract, this will not be a problem. The second thing that is required is a good charting package. You will need this to perform your analysis on the underlying assets of the binaries that you wish to trade with.

The Trend Is Your Friend
The objective of your analysis is to try and isolate a trend to focus on. It doesn’t matter if the trend is swinging upwards or moving down as you can either use a call or a put option to ride on the trend.

Finding The Trend
In our example, to help us find an ideal entry and exit point for trading the GBP/USD currency pair, we will be using a refinement of the “Multiple time frames trading strategy”. We refined it to accommodate the shorter time scales required for trading 60 seconds binary options. The time frames that we will be using are 30 minutes, 5 minutes and 1 minute. The 30 minutes chart is for finding the general trend while the 5 minutes chart will be used to confirm the trend. The 1 minute chart will be the chart that we will use for our trade.

Top Down Analysis
GBP/USD 30 minutes Chart

GBP/USD 5 Minutes Chart

GBP/USD 1 Minute

As we can see from the above three charts of the GBP/USD with different time scales, the GBP/USD seems to be trending sideways with no wild fluctuations. As the 3 charts line up, we can confirm that the general trend is a sideway trend with some minor fluctuations up and down.

GBP/USD 1 Minute Chart with Trendlines Drawn
60 seconds trading
If we zoom into the 1 minute chart and draw the relevant trendlines, we can see clearly how the GBP/USD is fluctuating up and down with some degree of consistency. Since each candlestick represent one minute, we can see from the above chart that roughly every 15 minutes the GBP/USD changes direction. Use a Call option when the GBP/USD is trending upwards and use a Put Option when it is trending downwards. Make sure the price band that you are working with is between the resistance and support levels as shown in the chart.

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