Category Archives: The Geek’s Strategy

NADEX Trading Tips; Your Account Settings And Execution Speed

How To Win On NADEX

My NADEX advice? Open a demo account now and use it to practice my NADEX trading tips. In my first installment of tips for trading NADEX I went over the charts, using the demo, setting up the platform for ease, expiry and strike prices, buying and selling as well as understanding how the order ticket works. In this installment I will go over the Account Settings and Preferences and how they can be used to fine tune the platforms function to increase your execution speed, maintain money management/risk control and, hopefully, increase your profitability.

Click Here For My Full Review Of NADEX Binary Options Exchange

In trading, short term day trading and speculation like what we do at NADEX and with any binary options trading, it all comes down to speed. You have to get in when the time is right and then get out when the time is right, delays in execution can cost profits at best, and create losses at worse. The problem is clear, the need is clear, read on to find out the solutions.

NADEX Account Settings And Preferences

If you have any doubts about NADEX being set up for traders, and for trader satisfaction, they will be dispelled soon. There is a learning curve, don’t get me wrong, NADEX is a fast paced and semi-complex trading environment. Once you get past the entry level obstacles these settings will personalize the platform and specifically the order ticket/order process so that you can achieve ultra fast execution speeds. To put it in perspective, the basic mechanics of entering an order can take as many as 6 steps and a minute or longer for the inexperienced; Open the ticket, choose buy or sell, choose market or limit order (limit adds the step of price you are willing to pay) and then enter. With the right set up you can lower this to as few as 2 steps and under 5 seconds, a huge difference wouldn’t you say?

To find the preferences page go to My Account, click on Settings (under the Fund Account tab) and then click on Preferences. Here you will find 6 settings, these are what they are. . .

  1. The Flashes – The Flashes are those neat little blips of color that show up on the ladder (the ladder is that screen with the list of strike prices and bid/ask prices). Each time a new price is offered or accepted the bid, ask or both will flash. If price goes up it flashes green, if it goes down it flashes red. The setting here is for the flashes to be on or off. I personally like them but NADEX says they may impair performance so that is all the hint I need to turn them off. Every little bit helps, right?
  2. Order Type – Order Type, GTC/LIMIT or Market, could be the most important choice you can make for time saving. A GTC/LIMIT order is good because you can set a price you like and leave the order open until it fills, but it takes time to enter the limit prices into the ticket. A Market order guarantees a near instant fill but you may get a price you don’t like. At face value I prefer the GTC but with another setting, more details below, the Market order becomes my preference.
  3. Default Order Size – This is a gem of a time saver, and an awesome tool for your money management. You can set the default order size to whatever you want. The default default is 1 lot, I like to trade 10 lots because it fits my account size and % Rule (no trade is bigger than 3% of my account). By setting this to your preferred trade size you not only cut down on the time it takes to fill out the order ticket you are also taking the guesswork and emotional quality out of deciding just how many lots you should trade at this time.
  4. Market Order Risk Tolerance – This setting goes hand in hand with the Order Type setting. If you choose to use the Market Order you can set the risk tolerance to help control your fill price. The default setting is $10, this means that your market order will fill if the price is within $10 of the price at the time you entered the order. You can set it as low as $1 or as high as $25. I like to keep mine at $5, this allows a little leeway for price movement while I enter the trade but keeps it to a minimum. I sometimes miss fills but not as many as I would using the GTC feature. In terms of execution speed this doesn’t really increase it but it does make using market orders safer which paves the way to 2 click trading.
  5. Multiple Or Reuse Ticket – This setting affects how the order tickets are displayed. The Multiple Ticket setting lets more than order ticket to pop up at one time. This way traders who use advance strategies utilizing multiple positions, hedging, butterflies and condors to see each leg of their trade at one time. The Reuse Ticket setting is great for traders who may buy and sell or sell and buy the same position more than once during the life of the option. Once an order is sent the ticket stays up and can be used again to enter another trade on the same strike.
  6. Inactivity Setting – This setting doesn’t help execution speed but it does help with Internet security. Set it to as little as 1 hour or as much as 12 hours and the platform will log you off automatically.

Candlestick Signals For Binary Option Social Trading

If you’ve been looking for a magic bullet to help you trade binary options this it. When I learned about them I felt as if I had found the secret I was looking for, like the wool had been pulled from my eyes. Price action jumped off the screen, I could see support and resistance with only a glance and my other technical tools, which up until then were nothing more than barely understood theories, clicked into place. I’m not here to tell you that using candlesticks is going to make you a millionaire overnight but I will say that a study of them and their principles can boost your overall success.

Candlesticks are the #1 tool for binary traders and I’ll tell you why; they turn trading into a game. That being said, trading is not a game, we’re talking about real money and real risk. What I mean is that candlestick charts animate market action to a level that is very much like a video game. The bulls are one color, the bears are another; their interactions displayed on a chart like a real-time x-ray of price action. Compared to other forms of charts, and in particular those crappy little ones provided by most brokers, there is no comparison. Candlestick charts are the only way to go.

What Is Candlestick Charting

Candlestick charts date back to the days of feudal Japan. In those times rice was like money, more valuable than gold. Rice was traded on the open market and even used as payment for samurai and others. Eventually rice farmers began to sell futures on their crop, that is, they sold next year’s crop at a price decided today. The price of next years crop changed from day to day along with supply/demand and to track this what we now call Candlestick Charting was born.

The feature that makes them so different from all other forms of charts is the 3 dimensional representation. The closest thing to them are O-H-L-C (open, high, low, close) charts which are drawn as skinny lines. The candlesticks expand on that by creating a rectangle around the open and closing prices, with wicks extending out to the high and low of the period.

candlesticks_basic

Many dozens of signals are formed by the candles. Some of them, like harami’s or engulfing patterns, have equivalents in other forms of charting; a harami is basically an “inside day”. The signals all have names that sound like Kung Fu moves; harami, doji, dragonfly, piercing pattern, hanging man, cloud reversal and three black crows to name few. When mastered, these patterns give very powerful short term signals and confirmations for longer term signals.

Candlestick Signals For Binary Options

candlestick courseI’m sure by now it is easy to see just how useful Japanese candlesticks can be. There are many sources of information on the internet but I suggest social traders get a book and learn to read candlestick signals on their own. There are many books on the subject, a few I can recommend are “The Candlestick Course” by Steve Nison and “Candlestick Charting Explained” by Gregory L. Morris. Morris gives a fantastic and in depth introduction to candle charts, signals and application. Nison, the man responsible for bringing this technique to the west, goes beyond the basics and provides an in depth course into the application of candle signals in every day trading.

Like all means of technical analysis the candles are cold, no pun intended. They signals, bullish and bearish, can occur in the market randomly based on day to day, or moment to moment, fluctuations in sentiment. The signals are best used in conjunction with other tools in order to establish trends, support, resistance and the proper perspective for reading each signals. One man’s Harami is another man’s Spinning Top. Investoo.com has dozens of videos teaching candlesticks and candlestick strategies and is a nice compliment to your book learning. Why wait when you could be profiting from these signals right now!

The Geek’s Top Five Tips To Get An Edge Social Trading

Everybody is looking for an edge over the market. This makes finding a good one extra hard, and opens the door for scammers, gurus and just about anyone with a computer to start offering signals and strategies “guaranteed” to make you rich at the push of a button. The problem with most of these is that their number one goal is to make money off of you, my trading brothers and sisters. The only way to truly gain an edge on the market is to educate yourself, learn to make good trades and do your trading well. Now, along with that, there are some tips and tricks I can offer to help get an edge social trading.

The Geek’s Tips For Getting An Edge On Binary Options Trading

This is not a good chart.
This is not a good chart.
1 – Charts – Charts are what trading is all about. Everything you need to make a good trade is represented on the charts in the price action. Most brokers have only the rudest of charts, simple little windows with about an hour of data represented by a squiggly line. There are no tools and no clear insight into trend, support, resistance or market health.

The best thing you can do for yourself is to NOT use the charts provided by your broker unless they are far superior to what I have just described. To get an edge over the market you need to be using advanced charts like what you can get with MT4, Java Charts and a number of other top charting packages. There are a couple of brokers including Binary.com and Tradorax that do provide better charts.

2 – Japanese Candle Sticks Candle sticks are one of the most advanced forms of charting, I highly recommend learning to read them if you truly want to get an edge on the market. Candle sticks turn simple price information into a clear picture depicting the battle between the bulls and the bears. They bring complex price patterns into sharp focus and provide some of the strongest signals in the trading world. All it takes is one look at this style of chart and you can easily see what I mean. The down days are black, the up days are white and when a significant event happens in the market it is easy to see. Candle stick signals can be as simple as one over large candle, or as complex as a series of candles and how they interact with each other. A few of the most commonly traded signals include Harami, Doji, Dragon Fly, Hanging Man, Piercing Patterns and Engulfing Candles.

Candle stick charts are best for binary traders.
Candle stick charts are best for binary traders.

3 – Know The Fundamentals The charts can tell you everything you need to know but reading the charts can be a challenge. If we assume that all knowledge is known by the market, and represented on the charts by price action, it is the fundamentals that are driving price action. Having an understanding of what fundamentals are, and their health relative to current market action, is a great way to gain an edge over the average trader.

The economic calendar, offered by several top sites, is a good place to start.
The economic calendar, offered by several top sites, is a good place to keep up with data and events.

Any indicator or system can and will provide signals in either direction regardless of trend and fundamentals. Understanding the fundamentals can help to weed out the false and/or lower probability signals. Fundamentals include central bank policy, economic data, earnings trends and any other information dictating market conditions. If fundamentals are improving, bull trades may be better, if fundamentals are deteriorating bear trades may be better. News websites, government agencies, earnings reports and other traders are among the top sources for this information. Bonus tip: if an announcement is due out, wait until after it is released before entering a trade.

4 – Trade Signals, Not Feelings Trading is all about signals and I don’t mean the bunk signals offered up by any Tom, Dick or Harry. To get an edge on the market you must use strategy be it based on price action, indicators or a combination of both. The strategy should include clearly defined rules for entry, and you should follow them. Trading on hunches, feelings or intuition may work once in a while but for long term success a structured method of entry is best. When your strategy provides a signal trade on it, it’s that simple. Keep track of which signals profited and which ones didn’t, as you build up some data and experience you can adjust your strategy to include new rules and insights you gain into the market. The hardest part about trading signals is being patient. It takes time for them to develop, they don’t happen all the time. Investoo.com has a great series of binary options videos and indicators designed to help newbies get a grip on identifying signals.

Signals Tell You When To Trade
Signals tell you when to trade, this chart shows three high probability entry points.

5 – Learn To Trade The News If Fundamentals provide the foundation of market movements it is news that determines market movement on a day to day basis. Learning how news affects the market, and what to do when good or bad news is released, is yet another way to get an edge on the market. Think about it like this; fundamentals are positive and improving leading to an up trend in the market but some bad news has prices down. Does this mean the market is reversing? No, most likely not. Most likely this near-term bad news has provided lower prices and a good entry for bullish positions. The same is true in reverse; if fundamentals are poor or deteriorating, leading to a down trend, one day of positive news can provide excellent entry into bearish positions. Like with signals, it takes patience because market moving news doesn’t always happen every day.