Is there a simple yet effective trading strategy for digital contracts? Some might say that a reliable and effective trading strategy—one that’s also simple—is impossible to find. But they’d be wrong.
Enter the Golden Ratio strategy, a method that combines simplicity with precision. It uses just two core tools: Exponential Moving Averages (EMAs) and the MACD (Moving Average Convergence Divergence) oscillator. This powerful trio helps traders accurately identify trend reversals and receive confirmed signals for entering trades. The best part? Even beginners can put it into practice.
The name of the strategy comes from its central signal: the crossover of two EMAs, often referred to as the “golden ratio” in trading. This crossover is widely recognized as one of the most reliable indicators of a new trend forming.
By adding the MACD oscillator, traders gain an additional layer of confirmation. MACD helps filter out market noise and validates the strength of the movement, making the strategy even more robust.
How to set up your Pocket Option trading terminal?
To use the Golden Ratio strategy, prepare your workspace by strictly adhering to the following recommendations:
- Timeframe: Select a timeframe of 15 minutes. This is the lower limit of the period for analyzing medium-term trends.
- Candlestick or bar chart. You can choose according your preferences.
- Indicators:
- Exponential Moving with a period of 50: this line will reflect the average price for the last 50 candles.
- Exponential Moving with a period of 200: this line will reflect a long-term trend.
- MACD: set the parameters to values 12, 26, 9. These are standard settings that are suitable for most assets.
More about the Golden Ratio Strategy?
The strategy is based on the search for two key signals: moving averages crossover and confirmation from MACD. Let’s see how it works in practice.
Suppose you are analyzing the EUR/USD currency pair chart. The short-term moving average (MA 50) is crossing the long-term moving average (MA 200) from bottom to top, and MACD is showing positive dynamics. This is a buy signal for the CALL option. You open a trade with an expiration time of 45 minutes. If the signal was correct, the price will continue to rise, and you will make a profit.
Similarly, if the short moving average (MA 50) crosses the long-term moving average (MA 200) from top to bottom and the MACD is negative, this is a signal to buy a PUT option.
Advantages of the Golden Ratio
Obviously, such a simple and profitable strategy with golden name have many advantages. We will mention the most significant ones:
- High accuracy: moving average crossover is one of the strongest signals for trend detection.
- Additional confirmation from MACD: adding an oscillator allows you to filter out false signals and increases the accuracy of the technique.
- Versatility: the system works on any trading platforms, as it uses the most common instruments, as well as with any assets.
In conclusion, the Golden Ratio strategy stands out as a powerful and reliable tool for trading binary options on the Pocket Option platform. Its strength lies in the seamless integration of key features that provide traders with a comfortable and efficient trading experience. By combining simplicity with precision, this strategy allows you to focus on what truly matters—identifying high-probability trading opportunities and making well-informed decisions.
To maximize the potential of the Golden Ratio strategy, it is essential to carefully set up your trading terminal according to the recommended guidelines and develop a thorough understanding of the strategy’s core principles. Discipline in following the signals and maintaining a consistent approach will help you build confidence and increase your chances of success.
Ultimately, while no strategy can guarantee profits without risk, the Golden Ratio strategy equips you with a solid framework to navigate the binary options market thoughtfully and strategically. With patience, practice, and adherence to the method, you can enhance your trading performance and work toward achieving consistent, long-term results.
