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Zero

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Creating a thread for the ASX index - post trade ideas or whatever. 

 

I started to do this in the Beat the Analyst thread - migrating that to here...

 

Today - suggested quite early buy pre-1pm and PM lows - trick was knowing that...  :)

 

As a follow-up on that suggestion : Markets did close higher, with an AM low, and by 12pm a low was set with an up move into 1pm.

PM kept that strength, with more confident buying opportunities around 3:30pm.  Could have shorted the high but that was a bit less certain in my opinion.

(With binaries, it is possible to estimate a low without knowing it exactly hence my suggestion.)

 

Small profits however from that tip, as it was a slow PM (ie. after say 2pm) and generally low volume day, with a steady market after early volatility (especially on the open) - meaning binaries were a bit ordinary.  Some erratic 20min binaries, which can be more random than anything. 

 

Tomorrow - Australian jobs data - and a few other things.  Of course, the US/overnight lead will start things off... 

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I should add the obvious - trade these suggestions at your own risk.

 

I am a client of IG, unaffiliated, trade for myself. 

 

I chose to trade binaries so my suggestions will be biased towards this style of trading, but (hopefully) can be useful for straight futures/CFDs.

 

I would normally trade the same suggestions as I make too - so am not just "blog-trading" (online paper trading). 

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Hmm, weak US lead yet the SPI is holding up disproportionately.  That might be unwound in the coming days.

 

Mornings might be a bit crazy - higher probability for a buy into 1pm binary after the early swings.  PM (later) should settle down, flatter into the close of day. 

Timing - better to wait for the trade to "appear".

 

 

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Thanks Zero.

Really appreciate you adding your trading ideas.

I hope we can start a small group of contributors and help teach each other a few things and even make a profit.

I have never traded binaries but your ideas will have me at least look at them.

 

Cheers,

 

JB.

 

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Hi JB,

 

Thanks for your positive comments!  I will have to post some more on binaries - any client of IG should be trading them in my opinion as IG has an awesome binary market (I'd like to know of anyone better!?).

 

They (binaries) give ultimate flexibility - there's always a trade.  A trap is over-trading.  Yet the first thing is that you have to be quite familiar with the market you are trading.  THEN find a binary that matches what you think might happen.  Intra-day trading of course.

 

You have to be willing to endure some frustration - more than usual - while learning.  There are times where the binary is 100%, but in 20sec that can go to zero.  All or nothing. 

 

A small point - while IG make the market - and so control the price of the binary and the liquidity - they obviously don't influence the settlement price of the binary (unless they enter the real/physical market in size to move it - they'd have to be caught on the wrong side of a massive position to want to do that, let alone be able to do that for 1min and not double down on a loss).  They hedge the binaries apparently, and will limit trades (traders) according to their liquidity - despite their wide-ish spread and totally automated pricing, they still have tight risk parameters.  It seems.  My earlier "questions" this week have said enough....

 

I'll have to post a bit more detail for my suggestions - sorry if they are a bit unclear.  So far I have posted a higher probability suggestion for the close of binaries.  Yet there's a whole day's trading in between - so if I can in time, I'll add some detail. 

 

So - to profitable trading!  :) 

 

 

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Today the ASX was stronger despite the US lead, however US futures are quite strong over the session to balance this divergence.  Be interesting to see which one corrects (ASX down or US rebound).

 

Today my suggestions were ok but not as good as I thought.  The 1pm buy was overshadowed by the large move higher then selling around the jobs data an hour earlier, the buy only good for 10pts.  The annoying thing is SOMEHOW (ie. as if the market was trading IG's binaries) the price stalled for 20mins into 1pm right on a binary level/zone (a few binaries seemed to align at the same price).  Fluctuating around there, giving no clue which way and so I left it alone.  Wasn't home to sell the high, expected a buy into 1pm so stuck to my own "suggestion" and did nothing.

 

The flat close was ok but IG not giving much away.  

Both had to be waited out (hence my tip).  So a tough day. 

 

Trading binaries either forces you to be super flexible and so changeas the market moves - a sort of feedback process.  Or you have a strong conviction, and go for it early (otherwise you miss good prices).  So it is hard to be super clear with suggestions at times, as I am making it up on the run. 

A good thing if you are focussing on binaries is to remember there is always another trade.  Whether you trade 20min binaries, hourly, or the 1pm and close-of-day.  There is always another opportunity - be selective.  Hopefully you will get a good fill (number of contracts) to make it worthwhile - that's up to IG. 

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With such a strong lead, you'd expect a positive day on the ASX.  But ... it may take a while to get started as a lot of that move has been factored in.  Still, I'll be looking to buy into the 1pm and close of day binaries, maybe 1hour from expiry.  That will be decided real-time.

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I am trading any binary that fits what I see happening on the market, and any time frame.  However the 20min binaries are more trouble than they're worth.  The 1pm and end of day mainly - and recently more plain ladder binaries. 

In terms of tips - I can write more over the day (sorry about the time-zone delay) - and if I can be more specific then let me know. 

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Sorry didn't fully answer your question - I am trading binaries for the ASX index.  I am familiar with how the ASX might/can/does move on an intra-day basis.  So can fit a binary to certain moves - so that's why I say any binary, any timescale - it depends on what the market is doing.

 

So that would be my first tip - get more familiar with a market you like/can trade.  Then look for yes/no events - then you can create a binary trade around that.  I'm sure for the Dow/SP and the FTSE there are heaps to chose from - the ASX is pretty good too. 

What market are you trading?

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Mid session (well 12pm) update - I would say a high has been put in for the day for the ASX, with selling at these highs.  Not as confident on a buy as suggested earlier, will tighten my expectations.  Maybe fade any highs in the next 30mins, PM we'll see. 

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What a silly day - selling pressure early on persisted, yet the market stayed high.  Spiked down after lunch, surged strongly on zero-volume, then fell heavily in the last 10mins.  Only buying opp then, and was too quick a turnaround for me to buy (the cash is always behind, so wanting to see where that ended up meant a delay in decision making). 

Yet as per my 12am update, the better strategy was to fade the highs seeing as the high for the day was set earlier as posted.  This info is gold for binaries, as if you have this conviction as it is an all or nothing piece of information.  Meaning you can go heavy on that piece of information.  The thing is there was only one chance in the PM to take advantage of it, and the binaries were priced so that there wasn't much in it. That was my only small trade for the day. 

Lunch I was purely lucky in my suggestion - was a dud session - hardly moving, so with 5pts to play with and a slow market, even the binaries were hard to extract some juice from.  YET - it was possible, and compared to a futures you would have been better off.  Fading the high around 12:30 was the better trade - buying 12am was also safe, but by 1pt. All or nothing...  Yet I gave it a miss. 

 

Not 100% what I expected from the get-go, and a tricky flow to the day.  Always something different, always unexpected.

Makes me wonder about Monday - selling at these highs today on the ASX.  Yet low volume on the cash (ie. real or physical market, the ASX / XJO).

 

I'll try and post more useful suggetions (rather than being technically accurate) - I don't believe it is worth being right for the sake of it - rather better to give useful suggestions.  If I can post in time - 12am update today for example. 

I'll probably take over the forum if I do this everyday, so won't bore everyone with the intraday meanderings of the ASX.  But I could post a bit more about binaries in general. 

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Will look to sell the PM rallies today, probably around 1:30pm - close.  Could either sell some 1-touch or ladder binaries above the early highs but that depends on how they are situated v the underlying ASX price, especially the one-touch. 

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1:50pm - China data at 1pm is giving the ASX a second wind, with it staying higher now.  Will still wait for some selling opportunities, perhaps later in the session.  Sense some selling into this strength, which may weaken. 

The ASX is about 5275 with a high of 5294.  IG's one touch binaries are well situated around 5300 and above, so some possible shorts there (saying that you don't think it will touch the strike of the 1-touch binary).  Ladders - heaps to chose from depending on where and when you pick the PM high. That's the art - waiting long enough to get the right binary v waiting too long or not long enough and missing a safe binary.  Always tricky.  Lots of other binaries to chose from - any of the available series actually. 

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Shorts above 5275 would have been safe all PM - actually after my previous post.  Yet I stepped away from my computer, so missed the best prices of the PM.  Silly me.  

Held up for the ASX close (a 5270 Ladder sell for 30pts would have been a good risk.  A bit cheap in my opinion - meaning the ASX was a bit too close to that value to justify the risk).  As posted I did end up selling at 5275 on a dodgy surge of 5pts, getting only 20pts (best for the last hour of the day but lower compared to last post where it was over 30!). 

 

There is always a play-off : certainty v profit.  For 20pts I am risking 80 (per contract) to make only 20.  Not worth it in some respects, as a direct short could have made a similar ammount (adjusting the number of contracts).  Yet in terms of (my) certainty, 20 was the best I could expect with 11 mins to lock-out (the binary market closes 11mins before the ASX close) and so as a 75-80% certainty I took it (with higher personal certainty, so not certainty from IG's pricing, you can in general load up on contracts, making the 20pts a decent trade and worth the effort.  I chose not to however).  The ASX was only at 5270 too, so 5pts away from my binary - a ladder binary at 5275 - which meant that it was going to be cheap anyway.  IG's pricing of binaries is brilliant - from a mathematical point of view.  Not infalliable, but pretty accurate. 

 

A trick is not to let the price of the option (ie. binary) distract from your strategy.  Just because it was priced at 20:80 I could have the internal debate - 20pts high risk, not worth it don't trade, OR, 20pts means (according to IG's pricing model) a high probability (that it won't be above this level if selling the binary) so trade.  Indecision straight away - deadly.  From experience this is always an annoying thing - AS a lot of the time IG are correct....  But try and have a strategy (like selling the PM rallies, 5275 was my choice from 1:30pm) and then waiting for a good price.  Again, as before - the waiting game is another art - too long and you'll miss the good price, too early and you've increased your risk if on expiry incorrect.  I love binaries...?! 

 

The SPI has been spanked into line after the ASX closed, down to day's lows in line with the weaker DOW and Chinese markets - Chinese data only as expected or lower than expected.  Actually - a perfect algo-controlled day too. 

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I am surprised that (the above) was a good suggestion.  I was going to take my own advice and short a 1-touch for 55 at 10:40 (1pm but turns out daily would have also been good - and even better as probably worth 60+) - but I normally do odd jobs during the first (volatile) hour so left it while I was out.  Hmm.  That was the day high, so suggested shorts into 1pm from there were good. 

Stabilized after that and flattened out into 1pm with some opps. trading the range. 

PM a little tricky - down to near lows, then a good bounce off lows.  A bit dicey into the close as a correlation widened after the market closed - not funny (can't know this or do anything about it but it can be dangerous!).  But a buy off lows also safe if you were quick.  I took a small sell off a late rally as I could see selling pressure across the PM. 

Again - a bit obvious but another perfect algo day!  No shame.  Small volume too - what's going on hey?  Dodgy.

 

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Update - 12:30pm - didn't get home till 12pm and the market is so slow! I'm glad I wasn't watching.  What's happening.  Spooky.

But not buying off lows at the moment.  Harder to trade in a snail paced market.  Will wait and see. PM also might have to adjust time expectations (from earlier suggestion).

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Got schooled at lunch following my own suggestions - my ? at the slow morning was ok as after that post the market dropped quickly, more than the whole morning's action.  Thought I had a good low, but was 5pts too high - binaries didn't recover by 1pm, and I was too slow to get in on some lower binaries to neutralise losses (NOT advisable to double down).  This all happened in about 4 mins, and it was too tricky to fiddle and get back in.

 

Then the SPI went bananas and surged higher!!  I didn't expect that so soon and so strong (expected it over the last hour, not in the first hour of the PM) so missed some great chances. 

Being dragged up by a strong Dow (futures) on low volume.  Still waited and bought into the close as suggested but it felt a bit messy - the volatility was up and the preceeding surge larger than expected (and earlier losses) made me tighten my risk - uncessary it turned out. 

 

A wonky day that in hindsight could have been a killer with a longer time frame perspective for some binaries (like buying the lows AT 1pm-2pm).  

 

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Looking for a buy on weakness today.  Selling AM and PM highs I guess.  A bit unclear at the moment.  Real-time strategising today.  Weakness now into close (overnight trading ASX) will give a weaker start/context for the day. 

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Not a convincing day - low volume on the cash market, buying strength after early lows.  Paused around 1pm, then took off to new highs, fading 2mins before close.  As suggested bought small positions at the early low, sold 2pm high, and sold a closing high.  Wanted a buy into the last hour of the close, but didn't have a feel for the day, instead got a more dangerous super risky sell near the day's end and closed it out before expiry unecessarily.  Edge-y markets so didn't want to be the hero.  Always another day.  I only mention my trades too to legitimise my suggestions.  Otherwise what's the point (of making the suggestions). 

Got rejected a few times too today - would have been profitable - that comes with trading binaries (adds to the frustration at times) - the delta can be super sensitive at times, causing a price change of the binary more quickly than my visual eye contact-mouse-click-lightspeed electrical signal-IG's server...!  I like that IG now allow you to go back to the ticket! instead of having to re-enter the same ticket!  Really great improvement IG.  I had three tries at a binary today - eventually got filled 25pts lower, but still worth it (a bit hairy doing that as you are second guessing yourself three times) - but shows how erratic the price was moving near expiry and why I say not a convincing day. 

 

Sorry I couldn't expand on my pre-market suggestion from early hours too.  Busy day. 

 

Think the ASX was just dragged up by China and Dow futures, all three having nothing better to do.  Hmm. 

 

 

 

 

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Hmm, bit of a tame day on the ASX considering the lead.  All the heavy lifting was done overnight.  I expected a stronger fall on the open to tidy up a few price discrepancies, but it got stopped quite abruptly and then was kept higher into the cash open.  An early rise (about 11am) was sold off, then the market kept steady into 1pm, and held up for a lot of the PM.  Some late selling (only 10pts) stabilised into the close.  Made for a few handy binaries trading the range, selling the highs would have been safe for-ever if you were on the spot. 

The Dow futures were quite strong early morning, faded over the day as China fell despite the US lead - so tonight will be interesting.  End of week for me.  Thanks IG for again making a great binary market !!

 

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Buying into the 1pm a little earlier in the session, and looking to sell a high around 12pm.  Just to add to the above. 

Not sure what that tag is too on the last post - I didn't do it intentionally if I did it at all...?

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Bit of a slow day.  Selling the morning highs the best trade, but that was a quick spike and all done.  Almost impossible to trade real-time.  My suggestions about 20mins too early for AM (in reality there was a good sell at about 12:20ish, and the buy about 1:05pm compared to what I guessed - pure guess at 4am this morning) - had to adjust on the run, but meant I held back on the binaries as time is tres-important for them.  I couldn't post here this adjustment in time - but have a suspicion that no one is trading my recommendations - sorry if you were (let me know if you are).   The sell would have covered any loss from the dodgy buy hopefully.

PM selling was fine too, but I had a conflicting signal, and with about a 5pt range for most of the last hour, it was hard to squeeze a binary out of that real-time.  I had two different trades but erred on the safe side uncessarily and closed them out.  Not looking to up the anti on a Monday.   IG seemed to find it a tricky day too - with some of their pricing being exposed by the erratic market.  I was tempted...

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