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Nadex 2 Hour Trade Strategy
09 ITM Scalping 09 close
This is another Nadex trade and this time I am trading slightly ITM ( In The Money ) at the time. I was able to get into this trade at $59.75 if I remember right. I had an intention of scalping out of the trade but for most of the entire remaining 1H and 16 minutes the market moved against me. This trade is a great example of a close call and why in most cases I will leave a Nadex trade early. On a lot of these videos you will hear me say stuff like take what the market gives you and move on. Sometimes the market will give you a hard time as well LOL. Not every trade you take will be fast in and out trades in your favor and I stayed in this one to show a live example of how a Nadex trade can work even if you got in on the same strong setups like you have been doing with no intent of sticking around to the end.
This time I will share Key points that could have been improved on so you can watch out for them:
1. Value area ignored: OK I do this sometimes and to be completely honest there is no right and wrong that you can follow so that you will never lose a trade or have them all go smoothly for you once you get in but VA High and low are indicators of the trend in place and where price is likely going.
Trading below VA Low: Probably easier to sell strength but what was I doing in this trade?
Trading above VA High: Probably easier to buy weakness.
Sure there are videos out of 140 on my channel where I break the rule and maybe the trade still worked but this is just a general guideline for better low hanging fruit to trade around.
2. Holding a losing trade that is acting up on you: OK I held the trade until the last minute literally LOL but again this was because I am taping a trade to share on youtube and I knew it. In a serious trade with however many contracts it is better to preserve your capital by cutting losses and saving that money for a better trading opportunity that I can almost guarantee you will show up in the future. A tip is that I had every intention of a fast scalp and when that did not work or when what behavior you are expecting to see from the market after you get in is clearly not happening just take your ball and bat and come back to play another day. The market owns the field but you decide when or if you will play at all.
3. Time means a lot in Binary options Trading: At first Theta ( Just jargon for one of the Greeks that represents time value in these contracts ) will be on your side. 46 minutes gone in a 2 hour contract with 1H 16M left. Now Theta is just cool jargon to share with trading buddies and make you sound smart it is a word that is all. Now let me share simple street sense aka common horse sense.
If what you thought would happen has not happened in 1 hour 13 minutes there is just very little chance of it happening in the next 3 minutes. So as Theta dries up the Market maker will jump what he is going to pay you for your almost worthless contract every which way but loose. Think of the Binary option like an hourglass with the sand running out and that sand is value. This is why holding until the end is most always not a good idea.
4. Scalping OTM or ATM requires less volatility in your favor to get in profits: OK lets run 2 scenarios here.
4.a: let's say the counter party Trading against you has at least the same risk as you on the contract or even more risk than you on a contract. When the market moves in your favor and out of his / hers will they be more inclined to sell in this scenario?
4.B: let's say the counter party Trading against you has less risk than you on a trade ( like in this video ). One of the reasons I could not get my fast pop like usual is because I paid too much and my trade was ITM for me $59.75 Risk but OTM only $40.25 for the counter party. So since there was less risk on their side for the trade from it's inception this is another reason why I had a harder time getting out.
This trade is funny to watch play out but I only got filled because I did get a pop at the end and this model has strict linear criteria to value a binary options contract, We are all humans and we can decide not to buy a contract only half a pip in the money in the last 45 seconds when it was out of the money most of the last 1 hour 57 minutes.
Nadex 2 hour Trade Strategy 08 OTM Scalping Strategy ( 061319 )
I am scalping a #nadex 2 hour trade OTM ( out of the money slightly ) in this video. This was one of those really fast trades that just worked out smoothly and I was able to get in and out of this 2 hour long binary in just minutes and tape it to share here on Youtube.
A: Price action: I was waiting patiently for a good impulsive move combined with that proven level that we hit earlier on in the day. We got back up there and first and foremost this price action playing out got me in from a subjective standpoint.
B: Crosswalk indicator: As I have been showing for years in these Binaryoptions videos now I just put some levels on our crosswalk indicator to represent objective high and low areas with the default settings I like + 41.3 (high level ) and -41.3 ( low level ). This is more objective to me and I combine the price action levels with this and let them work together helping me plan and time my entry.
C: Time of day: This was around lunch time for guys in New York so I was thinking we would get some of the slow down at a point because most guys would go out to eat and be away from their trading desk.
D: Always give OTM trades as much time as you can to play out: I don't want to take OTM scalps in the last of the binary options I want to be around the mid point or earlier so I have time for what I am looking for to happen.
Lets play would you rather.
Would you rather pay 47.75 for a contract with just over 1 hour in it for you to be right?
Would you rather pay 47.75 for a contract with just under 20 minutes in it for you to be right?
This cam be the same contract and even the same amount of risk but who is getting the biggest bang for their buck in this example? This was a scalp but like I said in the video I do not know when or even if a big move in my favor will happen so I need enough time for the bet to go from OTM to ITM so I can exit with my usually 30 - 35% profits on what I have risked per contract.
Nadex 2 hour Trade Strategy 07 | Counter trend trading | Secret RSI Strategy ( 060419 )
this video I am back with another Nadex 2 hour Trade. This time I am
trading as the market is in a wild swing to the upside retracing back
toward the highs earlier on the day I am betting down. I am going to
share a weird kind of way to use 2 RSI by dragging them on to your chart
over each other in the same window and painting them different colors.
This was a counter trend trade against the day and they are very
challenging to do because your timing has to be pretty good. You want to
be near a top and have enough time to get out at the exit in profits.
This is not an easy trade but it can be done.
A: Price action:
This is basically a wick trade and I am using this giant wick to the
top side. There was a lot of indecision due to the large moves up and
down and that choppy trading and the large wick off the top side made me
think this is going to be an interesting entry. Choppy trading earlier
that day in the PA is indecision. As Mark Twain said " History does not
repeat itself but it often rhymes ". So this is why I thought we may get
some choppy trading again only that afternoon on the same day.
B: This is counter trend: When
I am trading against the trend I like to be in and out a bit faster.
That is why I set a working order to leave early especially.
C: I am waiting for the sign that
the market may be setting up a reversal. This will mean that I pay more
for the bet but it helps with timing the entry better.
D: I am also going to show a little trick that I do sometimes that is sort of our RSI Hack.
I explained this backwards in the video sorry. I am using a fast RSI (
in Blue of 4 so that is an index of one hour on this 15 minute chart ).
Then I am using the typical settings of 14 ( So that is a longer slower
index ). I do not just jump in at the crossing of 70. I wait for the
fast RSI to get above 95 and start to fall back down. Because the index
on this RSI is shorter it will fall first and the subject of the trade
is 1 hour right? Not just the arbitrary index of 14 just because most
people use it right? This is the same as it will look in price action
but a helpful and objective way to spot the reversal early.
was good for me: I usually get like $20 - $25 potential on an ITM bet
but I could have got up to $40 here but I wanted to confirm the entry
F: Remember counter trend trading is in my opinion more difficult. so I would say use this approach very sparingly.
Nadex 2 hour Trade Strategy 06 OTM Scalping Strategy ( 052919 )
Another Nadex 2 hour Trade. This time I am trading an OTM ( Out of the money ) binary option with the intent of scalping if it can get back into profit before my 2 hours are up. I had 1 hour and 49 minutes on this trade when I got in but the entire duration was about 26 minutes from start to finish. I try and take you with me throughout the trade and I zoomed the chart in around the end so we can get a good look at the price action that got me in.
A: Have a plan don't just hop into trades: Before I got in this I knew I wanted to scalp on the EURUSD. I planned to do an at the money but it kept running past my strike so I ended up getting in OTM for just $46.50 / contract.
B: When I am going to do a Counter trend trade against the dominant trend then I do not expect this to hold forever. That is why I got to get in and out and did not expect to have a reversal all around on the day. Yes you can get in at the reversal of the day sometimes and that is fine but this was a 2 hour binary option OTM trade. I am not concerned with picking daily reversals when all I need is a bounce sometime in the next 2 hours.
C: When I am doing out of the money trades or ATM then I want to set a recent place that we have been to use as my target to get out. Also I want to be realistic in what I can hope to get out of the trade ( 30 - 50% of what I risk per contract seems to be a good area to me ).
D: When trading Nadex OTM: I used to use a Bible axiom of"don't glean the vineyards ". What I mean by this is that I do not want to take all the profit potential in the contract because even if I accomplish this market makers and other traders will have no incentive to help me get out of my trade by taking it for all the money still there for them to make. Contrary to popular belief in my opinion trading does not always have to be a zero sum game.
E: Give your self time to be right: When trading OTM trades especially counter trend like this one then give yourself time to be right in your scalp trade. That is why I try to get in early in a 2 hour or longer term binary option.
Nadex 2 hour Trade Strategy 05 | consolidation trading strategy ( May 19 2019 )
In this video I am back with another Nadex 2 hour Trade. This time I am trading as the market is in a consolidation period on Sunday before the London open. I got in on a ITM sell as there was a push against the longer term down trend. when the market is consolidating with only a little momentum it is not time to trade a bracket so that is why I am doing this ITM binary options on Nadex as I see strange behavior ( volatile push up in a consolidating market that is drifting down )
A: Time of the trade: This was a Sunday trade before the London open. So the market was consolidating with a slow drift to the downside. I saw low volatility in the price action for hours and I thought it was because no one was willing to go and buy before the London open where most people will trade this forex pair ( EUR/USD). This is sort of a time based trade that can recur on Sundays as the forex markets start the week after a series of Down days.
B: Determine a Bias: Is the market trending up or Down on the given time you will be in the trade. I am using the Channel surfing template for a birds eye view of the day it is free on our website.
C: When you determine a Down Bias then look for ITM above where the market is on a push up. When you determine an Up bias then look for ITM trades below where the market currently is on a push down.
NOTE: I determined a down bias and got in on a push up in this video
D: Price was good for me: I set an order for a sell at $21 and it got filled. I wanted a strike above the recent wicks at that price. The wicks were below the strike and the top of the average high prices for 6 hours was below that strike. Look at the Channel Surfing template those red / Blue moving averages of the high and low. Again I got in on a volatile push up in the middle of a consolidating market before London.
E: Trade with the longer term trend: This is the same market that sold off all of last week on the daily and hourly charts. So the bears seemed to be still in control and I just needed it to stay that way for about 54 minutes or so.
Nadex 2 Hour Trade 04 ( May 16 2019 )
In this Nadex 2 hour trade I am doing a news trade riding momentum for a little twist on how I usually do these trades. I lost Audio on the entry of the trade but I salvaged the last few minutes of this live trade and I am going to talk in detail about how I planed this trade at the beginning. I am trying to help fellow traders know how to avoid and how to use news on your side when trading forex pairs on the Nadex platform.
A: I rarely trade around news but when I do then I like to look for strong trends on the longer term price action charts. If there is really a trend you will see it. If you do not see it yet then wait and do not force the trade. We had been having nice down days all week. This may mean some of the report was priced in but when momentum keeps flowing in the same direction after the report then you are not just trading a news pop alone. Instead you are following an established weekly trend with news on your side as well.
B: Wait for the news to get out of your way before entering.I had to wait for the high impact news to see how the market would react. Check on our site:
set it for your timezone and make sure you are not going to trade around news unless this is your intent to do so.
C: Understand the news: When you get in a trade and it goes against you. It helps to understand all the reasons that you got in. That is why I talk a little about correlations and fundamentals in this video. 98% or more of traders just ignore fundamentals and correlations. I explain the Base and quote of a currency pair and how the news will effect money flow out of Europe and into the USA on a day that the news plays out with bullish sentiment. This will make USA markets strong and banks moving money for large clients will sell Euro Dollar bringing that base side down. Banks and forex flows are at the top of the food chain and can help your trade even if it is a short term trade.
D: I was trading the momentum and had to wait at least half way into the hour to get the news so this means I was only in for like 20 minutes or so. When I am trading momentum I want to get in closer to expire time and just ride that last bit out, I want to see the behavior and be sure it will hold for the remainder as best that I can do so.
E: Pricing: Notice that on this bet in a live account I was only able to get in at $21.25 / contract and I really like shooting for $20 - $25 bets in a live account because I would sooner wait for confirmations of what I am trading around than to try and get those extra $5 - $10.
Please watch the video carefully and feel free to write if I covered something in the fundamentals of the news or price action that was not so clear to you.
=========== Trade 03 ====
Hi everyone this is another Nadex 2 hour trade that I done in Demo this morning. I want to go over the basic approach that is used to find these setups but also I want to point out some of the differences that there will be from demo to live trades. You will notice that in this trade I was able to get $30.25 in Demo but at the same time that trade only had a potential value of $21.50 in the live account. This is why I said $20 to $25 / Contract is a good price in a live account for in the money Nadex in my opinion. Also I will talk about Volatility and why I did not want to take this trade live. Knowing when to sit on your hands and avoid close or losing trades is part of what will help you be profitable trading Nadex in the long run. Again here are the key points to this Nadex 2 hour trading strategy.
A: Determine a Bias: Is the market trending up or Down on the given time you will be in the trade. I am using the Channel surfing template for a birds eye view of the day it is free on our website here.
B: When you determine a Down Bias then look for ITM above where the market is on a push up. When you determine an Up bias then look for ITM trades below where the market currently is on a push down.
C: There should be 40 minutes to one hour left in the trade and I honestly think that closer to one hour will be better for the pricing.
D: Strikes should be above / Below the recent wicks: Not at but above or below the wicks by about 2 Pips minimum ( look at the price action in the trades I am sharing ) watch how close this trade is at the end because this is why we only take strikes above the wicks. Also the ITM ( In the money ) trade should be at $20 Minimum to about $25 potential profits when trading in a live account in my opinion. This pricing will also call you out of forcing trades and in the long run that will benefit your trading. Remember your In the money trades are the market maker or counter party's OTM ( Out of the money trades ) so you want them to pay you as much money as you can get for that trade don't you?
E: Know when to sit on your hands: Avoid low volatility in the markets because this can lead to tighter two hour trades ( even when you are in for one hour ). Avoid times when you do not think you see a clear trend or cycle in the markets. Don't force a trade instead let the market breakout and then fade or take the strong breakout that is shaping up after a squeeze in the price action. Breakouts will usually move 15 - 20+ Pips before they start flattening out and fading so be patient like I covered in this video. Avoid trading when there is news coming before your trade expires. Check on our website first to be sure there is no news in your way.
Link to the news on our site:
F: Always set a take profit for 70 - 80% of the potential profits there is in the trade. You do not want to be sitting there around the end with a tight trade when it is easier to take what the market gives you and benefit from the fact that these are tradable.
========= Nadex Trade 2 ====
is another video on Nadex 2 hour trades. In this video you can follow
along with me as I am doing a live trade on the EURUSD. The trade had
about 51 minutes in it when I entered the trade and I got in at a price
that I wanted for an ITM ( Nadex In The Money ) Trade. I will be
showing the trade setup and explaining the price action that I was
trading around at the time I got in. Please note that I made a mistake saying $20 - $50 and what I meant to say was $20 - $25 actually.
Some Key points:
at the time: This trade was taken on the EURUSD during the first 2
hours of trading in London ( very late at night my time ) this is where a
majority of the trading of this pair will take place and that is when
the market can move either sharply or out of your favor fast ( But it is
great when it moves in your favor on a Nadex ITM ).
B) I will go over this breakout pattern and explain how I used the guides in Channel surfer to confirm and enter the trade.
set a take profit that was 75% of the potential value of the contract
and in about 21 minutes I got out because my working order was filled. I
think it is important to look at the trade and how the market had to
react in order for me to get out early like this but my point is that it
can be done in a live account it is just that you need that extreme
volatility in your favor ( Vega in options Greeks ) with all that time (
Theta in options Greeks ) remaining. I would rather show visual people
then talk about option Greeks honestly I would rather do almost anything
than talk about the Greeks so that is all I will say about that LOL.
Price action purist should note the tight consolidation and then the
Beak out of the tight area to the upside along with the fact that it was
early London. This is when I look for price action patterns like this
because outside of some news or a random big order coming through there
is not often moves in your favor this much and this fast.
My computer was acting up so the video is not in perfect sync but I
hope watching some trades like this live and having the base template in
front of you will help some people find their way to some good strong
trades. The template is called channel surfing and is under Best Mt4 indicators for free on our website.
======== Trade 01 =====
The video above is all about Nadex 2 hour Binary Options. Again I am sharing what I think is the low hanging fruit to trade on the Nadex Exchange. I know that a lot of people like the sexy 5 minute binary options but I think the ITM ( In the money ) trades in the direction of your bias can be a lot easier to execute and trade. This is a trade that I done in a demo account so that I could completely focus on talking out the process and the setup from beginning to end. I was in this trade for about 1 hour and some minutes and that is a good place for me because some of the Theta ( Time ) has ran out of the binary option and but there is enough optionality left for you to get a good price ( $20 - $25 or so ) potential profit if the trade wins. I am covering a lot about how to read the price action on the chart and how to understand what is happening in front of you on a very basic chart. Below are my key take aways.
A: Determine the trend and get your bias and in this example of a 2 hour strategy I am using larger time frame candles ( 1 hour ) on a 15 minute chart to see what is happening and set a bias. 4 out of 5 candles closing down on the hour after the bounce off a very low deviation level the prior day. Then it stopped and bears took back over again. Wait for a day when bears are killing it and then see what the bulls can do and if they fail to move much then that is your bias or vice versa.
B: When your bias is down you want to sell ITM ABOVE some good wicks in the price action. NOT at the wicks but above them because your goal is to setup the most toxic situation that you can for the market maker. Either they will take your money or you will take theirs so do not feel bad about doing this process.
C: I was using my custom indicator the Cross walk and I like to setup mid areas to see when the markets are choppy ( that means to stay out of brackets especially ) or also to find when we are showing some strength what direction are we breaking out of mostly. Crosswalk has weak oscillations with lighter color and grey oscillations to help me spot indecision and choppy areas as well. So I look for strength ( dark colors ) and empty or mostly weak areas on the other side to make price action a bit less subjective for me.
D: I will usually set a working order to take profit early in case at the last minute the trade is tight and against me. You do not have to hold the binary option to the end on Nadex so it is a good idea to take advantage of that when you can and get out for 70 - 80% of the potential value. I show how to do this on a calculator.
E: Also lastly I show a precise way to set your levels so that your level on the MT4 chart will match the level on the Nadex charts and that is very important. You can not pick a strike on your MT4 without knowing where your S/R lines should be exactly.