› Binary Options Ladder System - How It Works

Binary Options Ladder System - How It Works

Ladder Option is a technical system based on trend-following principles. Composed of highly effective and popular indicators including Simple Moving Averages, a William% R, and a Moving Average Convergence Divergence, the White Ladder is a very useful tool for detecting mid-term trends. In this article, you will find out how to apply the system to make profits from binary options trading.

What is a Ladder Option?


As the Ladder Option is a with-trend trading technique, its main function is to ascertain and bring trading opportunities out of pullbacks in the market trending conditions. This system uses two Simple Moving Averages, one of which is set of 50 days and the remainder is set of 200 days. Consequently, mid-term trends are displayed quite obviously through these SMAs. Meanwhile, the William% R and the MACD – highly effective momentum measurers - have the responsibility to define and inform when the pullbacks are exhausted, which indicates that prices are about to resume the major trend.
Ladder option adds a feature that allows the holder to lock in partial profits at predetermined intervals.

Below are the detailed settings of the system:
  • A 50-day Simple Moving Averages;
  • A 200-day Simple Moving Averages;
  • A 14-day William% R;
  • A default Moving Average Convergence Divergence (12-26-9).

Being tested in the twelve months to October 2017, this trading technique’s win ratio is by far confirmed at 82.12%. The most prominent thing of the White Ladder is its comprehension: this system could be applied to any trading time frames and any currency pairs. Nevertheless, longer time frames usually generate higher-quality entries; therefore, you should use the system on at least 1-hour charts or above.
Let’s take a look at some practical examples to understand more about this powerful trending system.

How to use the Ladder in binary options trading



A call signal is determined when the following conditions are satisfied:
  • Price remains above both the SMA 50 and SMA 200;
  • The William% R turns above -80;
  • The MACD histogram crosses above the zero level from the bottom.

Binary Options Ladder System - How It Works


On the contrary, a put signal is spotted when the following requirements are met:
  • Price remains below both the SMA 50 and SMA 200;
  • The William% R turns below -20;
  • The MACD histogram crosses below the zero level from the top.

Binary Options Ladder System - How It Works


Below are some important rules when using this strategy:
  1. Only one position is opened at a time.
  2. The signal is affirmed valid only after the candle of confirmation is fully closed.
  3. Transactions should only be made when the distance between the SMA 50 and SMA 200 remains wide. Signals in choppy market conditions should be inorged.
  4. The order’s expiration is set in eight hours given that you trade on the 1-hour chart.
  5. The maximum risk for each transaction shouldn’t be more than 3% of your total balance.

If you like this strategy, you might also be interested in this Keltner Channel Trading

Pros and cons of the Ladder strategy



Pros:
  • Enables you to spot and follow reliable mid-term trends;
  • Offers clearly defined settings;
  • Simple, easy-to-use, all-purpose;
  • Very flexible and comprehensive;
  • Engenders high-probability trading opportunities.

Cons:
  • Requires a high level of patience;
  • Necessitates you to constantly observe the trading platform to determine signals.

Conclusion


As you already know, trending systems are always the best friends of chartists. The White Ladder – a very effective trend-chasing system that provides excellent levels of entry into the market with clearly defined settings – is really a good companion for market participants who love to trade in the mid-term. Given a right approach combined with tight money and psychology managing methods, making substantial profits in the long run with the White Ladder is totally possible.


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