Binary options have become a popular trading tool due to their simplicity and high profit potential. However, as with any exchange, successful trading requires a solid strategy based on careful market analysis.
Let us discuss more the Coincidence Strategy based on simultaneous use of two popular and time-tested oscillators: Awesome Oscillator (AO) and MACD (Moving Average Convergence Divergence). These indicators will easily help you determine the optimal points for buying a digital contract, and you can use their signals directly in the terminal from Pocket Option.
More about the Coincidence strategy and its settings
To implement the “Coincidence” strategy, it is recommended to use a candlestick chart. It allows you to clearly see reversal and trend movements, which is especially important when working with binary options.
In turn, the optimal time frame for this strategy is a 5-minute, which allows you not to wait for a long time for a signal, but at the same time is less susceptible to market “noise” than turbo options. However, the strategy allows you to experiment with time intervals and choose them to depend on your preferences and the characteristics of the asset.
To work with the Coincidence, it is better to choose popular assets with high volatility and liquidity, such as currency pairs, stocks or even cryptocurrencies. This will provide more opportunities for opening transactions and minimize the impact of market “noise”.
Awesome Oscillator (AO) is an oscillator that helps determine the direction of a trend. It is built on the basis of the difference between two moving averages and is displayed as a histogram. The classic settings use a fast-moving average of 5 periods and a slow one of 34 periods.
MACD (Moving Average Convergence Divergence) is an indicator for trend and oscillator analysis. It consists of two elements: a signal line and a histogram that displays the difference between the maximum and minimum price values for a particular period. The standard settings of the tool use an exponential moving average (EMA) with periods of 12, 26 and 9.
How to Trade with the Coincidence Strategy
To work according to the methodology given in this article, it is necessary to wait until both indicators give a similar signal to buy a contract. This is the main rule of the strategy, which increases the probability of a successful transaction since the signals will be confirmed simultaneously by two technical analysis tools.
Conditions for opening a CALL:
- Awesome Oscillator: The AO histogram should cross the zero level from the bottom up. This indicates a change from a bearish trend to a bullish one.
- MACD: A similar situation occurs when the MACD line crosses the zero level in the same direction. This is also a sign of the beginning of a bullish trend.
As soon as both indicators simultaneously give buy signals, open a CALL trade.
Conditions for opening a put trade (PUT):
- Awesome Oscillator: The AO histogram crosses the zero level from top to bottom, which indicates a change in the bullish trend to a bearish one.
- MACD: The MACD line crosses the zero level from top to bottom, confirming the beginning of a bearish trend.
When both indicators signal the beginning of a downward movement, open a PUT trade.
It is recommended to select the expiration period for transactions in the range of 2-3 candles of the selected timeframe. This will allow you to consider short-term price fluctuations and increase the chances of closing the transaction in the plus.
The Coincidence strategy based on the Awesome and MACD indicators allows binary options traders to find reliable entry points into the market. Using both indicators simultaneously significantly increase the likelihood of successful trades, as they complement each other and help filter out false signals.
