If your work schedule doesn't permit you to trade during normal working hours, here's a trading strategy you can use in the comfort of your home around the dinner hour. For the past several months, I've been testing an evening trade with the EUR/JPY that has been very promising if conditions are right. This strategy for trading Nadex Binary Options came from Krystal Comber, CEO and founder of SlickTrade.net.
The working name used for the strategy was the "8pm-11pm EST EUR/JPY Asian Session" strategy. But that's a mouthful to write and it's boring. After testing this strategy with a group of fellow Nadex traders, we decided to rename it to the "Sausage & Sushi" trade. Quite often, a predictable pattern happens with the EUR/JPY. If you can draw support and resistance lines,this strategy can greatly enhance your trading consistency. The rules for trading the "Sausage & Sushi" Strategy are quite simple:
- Log on to Nadex, and select the EUR/JPY currency pair with the "Daily 11pm" expiry.
- At 8:00pm EST, draw horizontal lines at the highest price (resistance) and the lowest price (support) between 6-pm-8pm on the 15-minute chart for the EUR/JPY. Draw your support and resistance lines on regular candle bodies, and not the wicks. Use regular candlesticks, and not Heiken-Ashi candlesticks. I trade this strategy on Nadex charts.
- Be aware of any economic news occurring on the EUR or JPY from 6pm – 11pm EST. Refer to Investing.com or Forex Factory to view economic news.
- For a SELL – After 8pm, if a candlestick closes below the 6pm-8pm support line, then SELL on the closest strike price at or above the support line. You can place a market order if you want your order filled immediately, or you can place a working/limit order if you want to adjust your risk/reward.
- For a BUY – After 8pm EST, if a candlestick closes above the 6pm-8pm resistance line, then BUY at the closest strike price available at or below the resistance line. You can place a market order if you want your order filled immediately, or you can place a working/limit order if you want to adjust your risk/reward.
- That’s it! Price is normally tested heavily between 9pm – 10pm EST –You may wish to walk away during this point and come back around 10pm -10:15pm EST.
- Always pay attention to the trend direction and news. If the market is sideways and staying within the high and low range you may want to avoid taking the trade. Also if the spread between 6-8pm support and resistance is very skinny, it's best to stay away from this trade.
Last night's "Sausage & Sushi" trade (July 15, 2015) played out very nicely:
6:00pm - 8:00pm EST: The EUR/JPY established RESISTANCE at 135.84 and SUPPORT at 135.48. A nice 36 pip spread. Support and resistance lines for the 6-8pm time period were plotted on the 15-minute chart at these levels.
8:00pm - 11pm EST: Within the first 30-minutes after 8pm, the EUR/JPY broke through the support line, gapping slightly below the T-Line (8EMA). Using the rules of this strategy, this triggered a pending/working SELL order from the nearest NADEX strike price above the support line (135.60).
The following order was placed Trade Details:
Contract: EUR/JPY >135.600 (11PM) Expiration: Wed Jul 15 23:00:00 EST 2015 Direction: SELL Quantity: 1 Price: $40.00
1 contract was sold, with a maximum risk of $60 and a maximum reward of $40.
Once the order filled, it ground it's way downward and the trade was looking good. At 9:30, the EUR/JPY spiked downward sharply. I had a decision to make it. With 1:15 minutes left in the trade, I was maxxed-out at $34 profit. Should I wait until 11pm to collect $40, or should I cash out early at $34 and take a sure thing?
I elected to cash out early and get a good night's sleep. I took the $34 profit, less $1.80 in exchange fees. The trade ultimately expired in the money at 11pm for full profit. After several months of trading this strategy, I have found that it can be very consistent if I like the setup. A sincere thanks to Krystal Comber for sharing this strategy. If you can draw support and resistance lines, you can trade the EUR/JPY "Sausage & Sushi" trade tonight!
About Krystal Comber: Krystal is the founder of SlickTrade.net SlickTrade provides live trading rooms, signals and setups for Nadex, IG Group and Forex traders. Krystal provides the following services:
- Video tutorials for trading with Nadex
- Winning strategies with detailed instructions
- ThinkorSwim (TOS) workspace setups and indicators
- Live trade signals
- A private Facebook group and chat group
- A personalized online trading journal that helps you track your trading activity
- Live support
Nadex is now available in 47 countries! Your fully functional demo will be funded with $25,000 in play money.
Watch Krystal Comber Explain the "Sausage & Sushi" Trade:
The Trading Pub Team