part0009

In this chapter I’ll assume you’ve found a broker (or already use one), opened an account and you’re ready to start trading. I’ll explain how I set my chart up before trading.

This is very important so don’t assume you’ve already got it set up correctly and skip this section because it could turn around and bite you in the ass later!

When you first log into your trading platform, if any of the ones I’ve used are anything to go by, you’ll start off with a line graph that looks like some kind of epic mountain range.

I don’t use this. To me it’s not a very clear representation of the data I’m looking at and my whole strategy is hinged on the way you display the data.

So please do everything I say in this book to make sure you’ve got the strategy down. Otherwise you can’t blame me for any lack of success you may experience!

First thing's first, for my chart I use candlesticks instead of the standard line graph. So find out how to change your graph to candlesticks.

If you’re using a separate platform for indicators, you only have to do this in that platform and not the broker platform you’re trading in.

If you’ve been paying attention then you’ll know that there’s usually two types of trading in any platform. You can trade classic binary options which usually have 15-minute expiry times or longer, or you can trade 60-second (or turbo) options.

If I'm trading with 60-second positions, I'll have the period of the candlestick at 5s-10s, which I’ll flick between to check my indicators. If I'm trading on 15-minute positions (which I don't do often), I'll have the period set at 2m-5m .

In case you haven’t worked it out, a candlestick is a green or red (usually) vertical bar and it can have thinner lines (wicks) protruding from the top and/or bottom.

So if the period is 10s, then the candlestick will start at whatever the price of the asset is at, say 1.123 for example, then at the end of 10 seconds say the price is now 1.124, the candlestick will be green and the top of it will be at the 1.124 mark.

If the price went above 1.124 at any point in those 10 seconds then there will be a wick above the candlestick going up to whatever that price was.

If the price went below the 1.123 mark we started at, there will be a wick below down to the lowest price it hit in those 10 seconds .

So you've got a green bar with the bottom part sitting on the price at the beginning of the 10 seconds and the top part sitting on the price at the end of those 10 seconds.

You've also potentially got a wick either end indicating the high and low prices the asset hit in those 10 seconds.

Of course if the price went up compared to the previous candlestick, it's going to be green and if it went down it will be red.

At the end of each 10 second period you'll get a new candlestick right next to the old one. Remember, this depends on the period you have set .

Here’s a neat little diagram to explain it. The white candlestick represents a green one and the black one represents red.

Notice on the upward candlestick, the top part (excluding the wick) is the close and on the downward one, the bottom part is the close.

It’s obvious when you think about it because if the price went down over a 10 second period, by definition, the close price is going to be lower than the open price .

So if you have a green candlestick then you get a red candlestick after, the top of each candlestick (excluding wicks) will be at the same value.

If you have a red candlestick followed by a green one, the bottom of each one will be the same value.

If you have two reds together then the top of the second one will line up to the bottom of the previous one.

If you have two greens then the bottom of the second one will line up with the top of the previous one.

This is the easiest way I've found to make sense of the data you'll be looking at to decide when you're going to open a position (place a trade) and, whether you're going to CALL (predict the price will go up) or PUT (predict it will go down).

You’ll start to find it very easy to notice patterns in candlesticks, much easier than using the line graph.

As I mentioned previously, this is very important to work in conjunction with the indicators I use.

I had no idea what I was doing when I first started trading. I had the standard graph, no indicators, I couldn't see any real patterns in the graph to figure out any kinds of rules I should be following to know when to CALL, when to PUT, or when to just wait .

I shouldn't have been trading, I should have waited until I'd learned some kind of strategy, but I just wanted to try my hand at it and make money like I'd seen other people do. Well you don't have to make those mistakes, I'll show you what I do now and what I should've done right at the start.