In the field of trading electronic contracts, success depends on the trader’s ability to analyze market movements and find optimal entry points. The questions if “What to do if you are a beginner trader?”
Read this article to learn more about a trading strategy “Coincidence” that does not require in-depth knowledge of technical analysis. You will have to follow the simple rules outlined below to earn money by buying digital contracts.
The Coincidence strategy is based on a combination of two powerful indicators – the Awesome Oscillator (AO) and MACD, which you can find in the Olymptrade terminal and other trading platforms. These indicators help identify trend reversals and assess current market strength, allowing traders to trade short-term options effectively.
How to set up your workspace?
Before you start trading, you need to set up the trading terminal. It plays a key role in the effectiveness of the further process. Please, take time to do it correctly.
For trading with the Coincidence strategy, you should choose financial instruments with high volatility. These can be currency pairs such as EUR/USD or GBP/USD, as well as indices and stocks. Volatile assets provide more trading opportunities, which makes this strategy more effective.
We recommend using a candlestick chart for market analysis, as it provides a visual display of price movements. The optimal time frame for the strategy is M5 (5 minutes).
Now about the indicators:
- Awesome Oscillator (AO) is an advisor that helps assess the current market momentum by comparing the average values of two periods. Use standard parameters. The green bar on the AO indicates an upward trend, and the red one indicates a downward trend.
- MACD is an indicator that combines trend and oscillator approaches, helping to assess the strength and direction of a trend. It is recommended to use the standard MACD settings: 12, 26 and 9.
How to trade with Coincidence strategy?
To successfully work with the system, a trader must closely monitor the signals of both indicators. Their simultaneous signals help confirm the direction of the market movement and minimize risks.
Signal for purchasing a CALL option:
- Awesome Oscillator (AO): The green AO band begins to form above the zero line, signaling the beginning of an uptrend.
- MACD: The MACD line crosses the signal line from bottom to top, which confirms the strength of the upward momentum.
Signals for purchasing a PUT option:
- Awesome Oscillator (AO): The red AO band is forming below the zero line, indicating a downtrend.
- MACD: The MACD line crosses the signal line from top to bottom, which confirms the market is weakening and the beginning of a downtrend.
The expiration time for this system will be 15 minutes.
The Coincidence strategy is effective for trading binary options because it combines the power of two popular indicators. The combination allows traders to accurately determine the moments of entry into a transaction, minimizing risks. At the same time, the strategy is suitable for both beginners and more experienced traders.