In this article I want to show you with some examples and trades why is important sometimes to take longer expires in your trades. As you know from my articles I like very much short- term trades and short- term expiry times like 5 minutes or even trades with 1 minute expiry. What problem is there with these expiry times. Nothing. As I said above i like them because you can make fast money. Are they risky? All trades could be risky but this is my point in this article. There are sometimes in which it’s more safe to take longer expiry times than 5 minutes for example, to avoid the noise. What I mean with this? Take a look in the first screenshot of the day.
This chart is from USDCAD currency pair. Let’s make a quick analysis in for the market. Notice the blue rectangle I drew in the chart. In this rectangle we have buying climax (the two green bullish volume bars) at highs and it is very possible a fall of the market the next minutes. The price in this rectangles make a high with buying climax, after that we have a pull back and then again is coming back and we have again buying climax with a pull back and last but not least a big rejection. After the reversal bar is a good spot to take a put binary option trade. We have many clues that the market will move below this spot in the next minutes. So, if a trader made this analysis here he is correct. But if he take a put trade with a short expiry time like 5 minutes it’s possible to loose his money. Notice the short consolidation period after the reversal. The price is beginning the fall some minutes later. In the red bar with the selling climax. Many times you can forget the facts and to want to make a fast profit. I do it very often. Before do this, make something simple. Make a zoom out to your chart. With this way, you can see that it’s a good opportunity for a put binary option trade and you will understand that it doesn’t worth to take a short term trade and risk your good estimation. Take a longer expiry time like 10 minutes or 15 minutes to be sure that you avoid a possible consolidation in the area before the real fall of the market.