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Mastering Precision: The Roller Coaster Strategy

Traders in financial markets often observe the price exhibiting oscillatory movements, resembling waves identified by professionals as trends, corrections, or reversals. While conventional wisdom advises trading in the direction of the primary trend to maximize potential profit, this principle doesn’t necessarily hold true for binary options.

Given the typically short validity period of electronic contracts and fixed profits, traders are less concerned about the extent of price changes. The crucial factor is anticipating the direction of this change early on, ensuring the avoidance of purchasing an option during a reversal.

Fortunately, this challenge can be effectively addressed by employing the right trading system. In this discussion, we will delve into the Rollercoaster strategy, designed to facilitate trading on market fluctuations, irrespective of the prevailing trend direction. Indeed, it is this unique feature that lends the strategy its distinctive name.

The Rollercoaster strategy embodies its name by capturing the essence of market fluctuations akin to the undulating motions of a rollercoaster ride. In binary options trading, where the emphasis is on quick decision-making and anticipating short-term price movements, this strategy offers a dynamic approach. It allows traders to navigate the market with agility, responding to the twists and turns of price action rather than adhering rigidly to the traditional notion of trading solely in the direction of the primary trend.

About setting up a terminal

Setting up for the RollerCoaster (RC) strategy on the Olymp Trade platform is easy  for clients. The trading platform Olymp Trade offers all the essential tools required for trading with this system.

Regarding the strategy itself, it relies on two widely recognized indicators, namely Parabolic SAR and MACD. Significantly, one of these indicators functions as a trend advisor, while the other serves as an oscillator. The synergistic use of these tools enhances signal quality, a well-known benefit of combining trend-following and oscillating indicators.

For optimal results, the strategy’s authors recommend applying the mentioned indicators on lower timeframes ranging from M5 to M15, an ideal timeframe range for binary options trading. The default settings of the tools are generally suitable, with adjustments typically made when transitioning to higher timeframes for long-term trading. However, within the framework of the “Rollercoaster” strategy, these nuances hold minimal relevance. The strategy is designed to work effectively with the default settings on the specified timeframes, simplifying the implementation process for traders.

For effective application of this method, it is recommended to opt for volatile assets that exhibit a clearly defined wave structure on the chart. Utilize Japanese candlesticks as the chart representation for better clarity.

With the setup of the trading terminal now complete, the next step is to delve into the rules governing the utilization of this system.

How to trade using the RC strategy

The methodology involves leveraging a synergistic combination of robust signals from the aforementioned indicators. Parabolic SAR reveals the market direction through the arrangement of dots: above the candle indicates a downward price movement, while below suggests an upward price movement. Meanwhile, MACD’s most potent signal occurs when the signal line extends beyond the histogram. If this transpires in the upper region, it signals the commencement of a downward movement, and if in the lower area, it signifies an upward movement.

To execute a CALL contract, it is recommended to make the purchase when the Parabolic point is below the candle, aligning with MACD moving beyond the histogram in the lower region. This combination of signals aims to enhance the accuracy of trade decisions based on the prevailing market conditions.

To execute a PUT contract, consider making the purchase when the Parabolic point is positioned above the candle, coupled with MACD extending beyond the histogram in the upper region. This conjunction of signals aims to strengthen the decision-making process by aligning with the prevailing market dynamics.

The expiration period aligns with two consecutive timeframes. For instance, if you’re trading on M5, the contract duration will be set at 10 minutes.

In conclusion, the RC strategy presents a systematic approach to binary options trading, offering reliable signals for contract initiation. The synchronization of Parabolic SAR and MACD indicators provides a comprehensive view of market dynamics. However, in the volatile landscape of financial markets, it is vital to consider external factors such as news releases and the potential for speculation. Consequently, traders are strongly advised not to neglect the fundamental principles of money management to ensure a balanced and disciplined trading approach. By aligning the strategy with these considerations, traders can navigate the intricacies of the market with greater precision and effectiveness.

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