High Probability Forex Binary Options Trading with Pull Back Strategy. Waiting for a pull back and trading from that pull back is a much higher probability play than entering at the extended part of a move.
Why trading pull backs is so profitable, is because markets ebb and flow, and a pull back helps you to refine your entry point so that you are entering at or close to the turning point between the ebb and flow (again, this is not top or bottom picking because we are not trying to predict a trend change).
You won’t always get it exactly right, but this Trend Following strategy is highly effective and very low risk.
Waiting for a pull back and trading from that pull back is a much higher probability play than entering at the extended part of a move.
Pull backs can help lower entry point risk as we are usually trading at a key market area that has previously shown support /resistance (depending on the direction you are trading of course).
Let’s look at a chart to understand this better… In the chart below, we have a clear DOWNTREND in place.
As you can see, if you tried to BUY near any of those low points, the market only moved up a small distance before the trend resumed, and the MUCH bigger payoff came if you had looked to be a seller on the retracements higher or a seller on strength.
- We have a clear DOWNTREND market. Wait for the PULLBACK (Look to SELL into a downtrend as it PULLSACK to upside)
- Open SELL Entry when:
- Trend Signal indicator downward
- CCI NUF Yellow color
- Profitable Strategy 1 Red color
- William Percent Range line downward and below 0 level
- Signal Trend Red color bars
Identify trend then look for pull backs…
The primary way to trade pull backs is to LOOK FOR TREND and then LOOK FOR PULLBACKS within the trend.
- We need to remember, however, that markets do not move in straight lines.
- So, if you have identified an uptrend, for example, it doesn’t mean the market may not move down for a candle or two candles or three candles or more candles, within that overall uptrend.
- Pull backs provide us entry opportunities on daily as well as intraday charts.
- A trader truly focused on trading pull backs must learn discipline and patience, because trading pull backs mean you aren’t just entering wherever and whenever you want.