Mastering Boom and Crash Indices: A Profitable Trading Strategy

Boom and Crash Indices Trading Strategy: An Overview

An Effective Trading Strategy:

If you are a trader who craves volatility and rapid returns, you will find Boom and Crash indices exhilarating. So, if you want to ride these markets, here’s a simple yet effective strategy.

Broker DERIV DEMO ACCOUNT

Understanding the Trading Strategy

These are all based on detecting market reversals in the Crash 100, Boom 100, Crash 500, and Boom 500 indices. Here’s how it works:

Timeline: The 1-hour chart will be our analysis tool.

Indicators:

• RSI (1 period): Levels of 9, 10, and 11 are oversold: levels of 89, 90, 91, and 92 are overbought.
• MACD (12, 26, 9): This will allow us to confirm momentum reversals.
• Moving Average (5 exp): This will be a trend-filtering device.
• Bollinger Bands (34, 1.619) will allow us to identify potential reversals.

Buy Setup:

1. Check for oversold conditions on the moving average and the MACD.
2. Watch for the rejection of the return outside the Bollinger Bands.
3. Len The moving average will begin to V shape out.
4. Patterns in the Market: Identify a V or W Pattern with Rejections
5. On The Setup: Buy On Market Push Up With At Least 1 Candle After V or W

Sell Setup:

1. The moving average and MACD should indicate overbought conditions.
2. Expect the market to fail to exceed beyond the Bollinger Bands.
3. Observe for an inverse V shape to start building in on the moving average.
4. Find a market with rejections for a V or M pattern.
5. With at least one candle after V or M setup, enter the sell order when the market pushes down.

Key Points to Remember

1. The success of the strategy is all about identifying V and W patterns, which show that reversal is on the way.
2. For this reason, rejections from the Bollinger Bands are key in the validation of these reversals.
3. Interestingly, the 1-hour chart is what I found to be the best time frame to trade these indices.

Recommended Broker: Deriv

So to trade these indices, I recommend Deriv, which is a trusted and simple-to-use platform. Their intuitive interface and tools make it easy to access these markets and execute this Trading Strategy.

Deriv Demo account

Disclaimer: Trading is risky, and this Trading Strategy is not an easy road to success. Note, that you must always backtest your strategies and risk them responsibly.

IQ Option

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Deriv

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Exness

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XM

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Pocket Option

• Methods of payment: Bank transfer, debit/credit card, payment apps, cryptos
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