Triangle Breakout Strategy

In trading binary options at our disposal numerous tools and trading strategies that we can use to strategy of triangles have more options to increase the potential benefits. We must also try as much as possible in reducing losses, so make use of certain investment tactics can serve much help to achieve this goal.

Capital management in negotiations with binary options is vital to maintain a balance and profit-loss will be key to enjoying good returns on our portfolio of operations.

Depending on the goals and needs of each is important to find out what is the most profitable strategy are going to provide and also have to learn to use them at the right time to collect the income.

In this particular post we’ll talk about a strategy that is becoming increasingly popular, especially among those traders who like to play with the levels of support and resistance price and have knowledge of the graphical analysis.

Triangles Strategy – What is it

The strategy is based triangles in charting a graphical analysis method that studies the figures drawn assets with their quotes. It basically consists of geometric figures seek help us as a reference for the behavior that will prices. Such analyzes are helpful for determining levels of support and resistance price directions and identify trends in the future.

As the name suggests we triangles in the strategy we will have to look for are the formations of triangles, either up or down. This means we have to identify patterns of triangles in bullish and bearish trends.

At first it may be a difficult task, especially if you are unfamiliar with this type of analysis. In fact, I would propose to acquire a smattering of charting before attempting to implement this strategy, since you may not work as well as they should. As they say knowledge is the key to success, so do not skimp on learning.

How it works

The strategy of the triangle can be implemented in two ways:

  • Through an ascending (or bullish) triangle
  • Through a top-down (or bearish) triangle

Yes we seek an ascending triangle pattern this will be based on the level of resistance, which means that in case of rupture will occur there, in upward direction, the top or roof of the triangle. To enjoy gains here have to buy a CALL option type because the price direction and will break up.

On the other hand, we did find a pattern of descending triangle he will then based at the support level, which if broken will occur down on the floor of the triangle. Yes you want to make profit with this pattern will need to purchase a put option type PUT, then the price will fall and break the support level, ie downwards.

In these cases, especially when operating with binary options, we have to take special care with retreats or advances, so a good strategy would be to run multiple options “PUTS” and “CALLS” once we see that it has formed a pattern, either ascending or descending triangle. Basically this will work as we hedging strategy , to make a little extra in case of losses lose everything.

The Strategy Breakout

Triangle trading strategy breakout
To put the strategy into practice as recommended breakouts will draw a horizontal line where we observed an area of ​​resistance or support that has been achieved for the price of 3 or more occasions. Having done this we can try to form a triangle, either upward or downward, as we can, with a line of bull or bear trend using the maximum and minimum of the sails of the graph.

How do we have discussed and type CALL operations when the breakout occurs in the formation of an ascending triangle, while we PUT operations when the break occurs in a descending triangle.

In this strategy you can use additional tools such as risk control options stop loss at the levels of support and resistance of the triangle.

The Resistance and Support Strategy

When you have identified the formation of a triangle we can perform operations whenever lines triangle in their levels of resistance and support are touching.

Basically this will be performed when the active call options quoted upward near the resistance level and operate PUT options when values ​​are directed toward the bearish support level. It’s that simple.

In conclusion, I would note that as any strategy will always be to raise the basic skills necessary to learn about the trade concerned. In this case the binary options, so in addition to know how the trading options is essential to learn charting techniques (mapping) and identify support and resistance levels. That said, I wish you to succeed in your operations.