Since the rise of internet trading in the global trader community, numerous electronic advisors have been developed, greatly simplifying market analysis. Nevertheless, not all financial professionals are eager to embrace novel techniques, opting instead for tried-and-true methods.
It is essential to acknowledge that this traditional approach is entirely justified. Trading fundamentals remain constant, and financial markets continue to adhere to the same rules and patterns that have been leveraged for profit over the past few decades.
This article will delve into a strategy centered on two widely embraced indicators that have been utilized by thousands of traders across the globe. These tools have withstood the test of time and have consistently yielded favorable results in all market types, ranging from commodities to binary options.
This strategy has aptly earned the moniker “Old School”. It employs signals from Bollinger Bands and Stochastic. It is a very smart choice, because one is a trend indicator, and the other is an oscillator. What is more important, you will find both advisors in the terminal from Pocket Option.
How to set up a trading terminal
The platform provided by Pocket Option broker rightfully stands out as one of the most versatile options available. It offers an extensive array of tools for comprehensive market analysis. However, for implementing the “Old School” strategy and reaping profits, you don’t need an extensive arsenal of tools.
One of the notable advantages of this system is its suitability for lower timeframes. This aspect is particularly relevant in the digital options market, as prolonged trading strategies are generally impractical.
Hence, it is advisable to select a timeframe for a single candle’s formation from M1 to M10. In practice, the most optimal choice, as confirmed by experience, is typically M5.
How to trade with the “Old School” Strategy
With the work area all configured, it’s time to initiate the signal hunt. The key focus here revolves around monitoring price movements as they break out of the channel delineated by Bollinger Bands. For numerous traders, this factor alone serves as a sufficient trigger to initiate a trade in the opposing direction.
However, there are scenarios wherein, during a strong market move, the price persistently resides beyond the Bollinger Bands’ boundaries without showing signs of reversing. To safeguard potential gains and prevent turning a profitable situation into a loss, this strategy incorporates an additional signal derived from the Stochastic indicator, specifically a classic exit from the “Overbought” zones.
A CALL option when the price breaks out below the lower boundary of the Bollinger Bands, and the Stochastic indicator exits the oversold zone.
A PUT contract when the price breaches the upper Bollinger Bands boundary, concurrently with the Stochastic indicator exiting the overbought region.
The expiration period aligns with the duration of constructing three bars.
The “Old School” system boasts an impressive success rate, with positive transactions reaching up to 85%. This remarkable track record explains why a substantial number of traders opt for this time-tested technique, which has consistently proven its effectiveness over the years.
In conclusion, the “Old School” strategy, with its straightforward signals and high success rate, remains a popular choice among traders for achieving consistent profits.
