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Put Option on a Jumper

We used a jumper candle to help us find our trade today. After a long day yesterday without a trade it was time to find a good setup. All morning the charts looked bleak. There was nothing setting up to our liking. We watched a pretty strong channel form, but other than that we waited for price to make it’s move on the EURUSD.

Finally around 10:30 this morning we saw a break to the north side. Price climbed from the bottom of the channel to new highs for the day. It broke out through a nice wick that occurred several hours prior. Price was then approaching the pivot line. As price was climbing we were getting ready for a trade at Traderush. This allowed us enough time to get a really good fill and watch price move in our direction soon after some minor pain. Price continued to drop for the next 10 minutes in the south side direction. By the time this trade was closed we saw a nine pip winner. After yesterday’s wild ride, it was nice to get in on this trade. We’ll take these all day and continue to look out for them.

In the image below you can see how price was fluctuating between the purple line of 1.3063 and the purple line of 1.3042. We’ve been talking about the purple line of 1.3042 for several months now and it’s still a factor when taking trades. Price eventually broke South this morning around 10 o’clock. After 4-5 candles of slight upward momentum, we saw a nice jumper candle that moved up nearly 40 pips on one five-minute candle. Price then started to form a wick right at the pivot level. This is when we decided to take our put option at Traderush. After a slight ounce of pain against us, price eventually moved south for three straight candles, giving us a nice winner for the day. You can see on the chart, price moved up soon after our exit making new highs and reaching the purple line of 1.3084. Price has since dropped off, back to our entry and is consolidating at this level. It’s pretty much a good thing that this trading day is over because, right now price action is not showing very much.
Taking put options near pivot
On a day like yesterday, you really need to be careful and watch your risk. Sometimes it’s best just to stay out of the market and avoid all situations. This doesn’t mean you won’t make money trading over the long run, it just means you’ll be able to take trades in the future. Days like yesterday can make traders go crazy and destroy their accounts in just a few trades. A few people mentioned on the YouTube channel about closing their trade stations after having several losers. This is critical on a day like this. A lot of crushing spirals occur when price action is very volatile and hard to predict.

We continue to work on the site and we’ll hopefully have some newer updates real soon. If you have any questions or comments you can always ask.
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Comments

  1. Hi Rich

    Thank you for the website and youtube videos. They are helping me a lot with my demo trading on Binary Options. I just have a question that I can not seem to find out.
    How do binary option brokers make their money if they do not have a spread and take any commission from each trade?

    Regards
    Miguel

    • Hey Miguel,

      This is quite simple. It’s us against them. If we lose our trades they make money and if we win our trades they lose. It’s a bit gray, but this is the way it is right now.

      Rich

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