Within the range of strategies available to choose from today we’ll talk about the strategy of flag or pennant. Do you know the strategy strategy to flag binary options of triangles? Yes you answered yes then you are in luck because this tactic is quite similar. You know but do not worry because then we will explain in detail to you the you learn.
When you start trading binary options will eventually acquiring expertise on this trade. As we operate will be defining the way we act in the markets and we will use a specific analytical tools to implement investment strategies that best suit our goals and investment needs.
Thus defined traders with different investor profiles, where we can identify roughly risky investors and moderates. Well, continuing with what we want, Bandera strategy is a strategy that will help us decide what kind of option to purchase behave according to quotes in a graph. We will see in more detail.
Introduction: Flag Strategy
Flag strategy is based on the charting, mapping a method consisting in detecting the formation of geometric figures made contributions. Note that early detection of these formations on time is a difficult task especially when these consolidations occur in very high temporalities, since in most cases usually do something heavy. It takes patience, things as they are.
But relax, this analysis strategy works perfect short term. It tries to detect the formation of a Flag “Flag and Pennant” (Flag and Pennant) and we can start negotiating with the contributions of different underlying financial assets .
Also, should you learn to interpret the “Ceiling and Floor”, ie, the support and resistance levels to interpret in the right way and to know how to detect in the figures where we have or breaks or breaks in trends.
How Does it Work?
The strategy also known as Flag wedges and pins are easy to use and detect graphics. Of course you need to have some knowledge on charting handle us better with this type of analysis.
For this strategy you can use two types of signals to perform operations based on the charting formations.
The following available operations are:
- Through ruptures or breaks in trends.
- Through resistance and support levels.
- In either case the strategy should function as Bandera, just be patient and carefully observe the behavior of prices for specifically identifying these formations. Now for the strategy options with breaks and then we will discuss the strategy for resistance and support options.
Strategy Options for Ruptured Flag
If you want to use flag strategy for ruptures options you have to do first is to detect the formation of the Flag, either bullish or bearish. Once detected have to look at the graphs of the quotes some strong progress in some of the different underlying assets that you want to invest.
Then you must look at the graph in search of a formation, the figure is expected to consolidate and a break occurs in the resistance area (roof) or the support zone (soil). When it does break up itself will need to purchase a call option CALL and yes the break down happens because an option to sell PUT.
Flag strategy for resistance and support options
Another option is to use this strategy with the resistances and supports. To implement it is recommended to use larger time scales of 15 minutes later. In fact, I discourage use in turbo maturities type options 60 seconds to 5 minutes.
With short-term time frames but a little wider, as I just mentioned, we will do better, because with maturities express the success rate is more likely to fail.
For this strategy specifically what to do is also the flag or flags to identify and act accordingly and as appropriate at all times. It is buy when the price reaches the ground or support and sell when touch the ceiling or resistance level. In other words, we must acquire a call option when the price reaches the limit value upward and PUT option when the limit price downtrend.
To act more security you can wait for prices touching levels repeatedly, either resistance or support. This way you can more accurately confirm the direction of the trends and your operations are the most successful.