Trade the Call/Put and Touch/No Touch Contract With the Rounding Pattern Strategy

Trade the Call/Put and Touch/No Touch Contract With the Rounding Pattern Strategy

Share This!

Going past the fundamentals, technical analysis is where most binary option traders will be able to generate advantages large enough to increase their win-rate sufficiently so that they land in profitable-territory. It is no small feat to accomplish (on most trade-types, the win-rate will have to be in excess of 56-60%), but it can indeed be done and the strategy I’m about to discuss below is one potential tool that will help you get there. Technical analysis is about chart patter-recognition. This is indeed 90% of the work involved in these strategies, because once properly identified, chart patterns are quite self-explanatory when it comes to placing the actual trades they “call” for. This axiom is doubly true in the case of the rounding pattern, which we will use to trade the Call/Put and Touch/No Touch contracts in a profitable way, obviously.

What are the rounding patterns, how do we spot them and what do they mean?

Rounding  patterns fall into two basic categories: rounding bottoms and rounding tops. A rounding bottom pattern is defined by a curved trace, which links the successive bottoms of candlestick lows. By extending this trace in a symmetrical way, the person doing the technical analysis will get a saucer-shaped curve, which is the rounding bottom pattern we’re looking for. By definition, the critical points which define our rounding bottom are at a series of minor support levels, which follow an initial support which we use as the starting point of our rounding bottom. The trace has to touch at least two such candlestick lows in order to hint at a developing rounding bottom.

All the above-said are valid for rounding tops as well, only in this case, the pattern we’re looking at is an upside-down saucer, and it is defined by a series of successive resistance levels. For all practical purposes though, it is identified the same way the rounding bottom pattern is.

Back to our rounding bottom though: once the trace is drawn up and the pattern is indeed confirmed, the curve will act as a solid support and the trader can expect all later asset-price action to bounce right back off it. The shape of the rounding bottom trace also points at a complete reversal of the trend that was dominant when the rounding bottom shape began to form.

With all the above said in mind, for most traders, it should be clear how these rounding patterns can be traded both through the use of the Put/Call contract and the Touch/No touch one. To make that even clearer, let’s sum up all the above: the presence of a rounding top or a rounding bottom pattern – when confirmed – means that a trend reversal is about to happen. Rounding top patterns point to the reversal of a bullish trend into a bearish one, while rounding bottoms mean a bearish trend is about to morph into a bullish one.

? Want to make money automatically with Forex, Bitcoin and other Cryptocurrencies, Commodities etc without the risk of trading yourself? Are you ready for self-custody of your investment funds? Do you like the sound of regular consistent results and profitable performance? Tired of the forex and crypto scams, false promises and games out there designed to separate you from your hard earned funds? Stop everything! WorldMarkets is for you! With the WorldMarkets AI Managed Account Services, only YOU are in control of your investment funds. WorldMarkets is a trading platform that uses artificial intelligence to handpick highly profitable and low-risk trades for its users. It also goes ahead to trade for you based on analyzed data. And yea, you guessed right, “it almost never loses”. This is indeed the holy grail of trading. It is much more reliable and profitable than paying gurus to trade for you, mulling over candle sticks or playing the luck game. Using this system, investors and traders have recorded over 30% Returns on Investment in less than a month. And with a 100% compound return, you simply cannot lose with WorldMarkets. All you have to do is sit back, manage your funds and let the AI trade for you. Are you ready to start making aggressive profits regardless of the market’s direction? If you are ready to leave the trading to the professionals and upgrade your monthly income, now is the time, head to WorldMarkets now and choose a plan to start trading. PS: WorldMarkets is a Profitable Forex/Crypto AI Managed Trading Service. 100% Verified and Recommended by



Rounding Bottom.png


Following the identification of the rounding top/bottom pattern, before the actual trades are placed, the trader allows the price-action to bounce off the firm support/resistance curve defined by the saucer-shaped trace, just to gain additional confirmation that the pattern does indeed hold water. While for trend-reversals, the stochastic oscillator usually makes a superb conformation-tool, in this instance, its usefulness is rather limited, due to the multitude of various signals that it will end up generating through the price-action period covered by the pattern.

How do we trade then?

As said above, after the saucer is drawn up, the trader allows for two bounce-backs and then enters a CALL trade right where the second bounce-off is (in the case of a rounding bottom of course). If we’re dealing with a rounding top pattern, a PUT trade is entered at the second bounce-off. The finesse of the trade consists in the proper setting of the expiry: we need to allow the trend plenty of time to run its course, so the expiry on this one will be quite generous. If the analysis is done on an hourly chart, the expiry has to be set to about 4 hours.

The trading of the Touch/No Touch contracts is even more straightforward. The saucer-shaped trace that we drew up also acts as the boundary between the Touch and No Touch zones. In the case of a rounding bottom for instance, the reversal is a bullish one so the price goes upwards, which means the Touch zone is above the saucer, while the No Touch one is below it. In the case of a rounding top though, the Touch Zone is below the saucer, and the No Touch zone is above it. That pretty much points to how the trades should be placed.

Looking at a rounding bottom: starting off the point where the CALL trade was placed in the above scenario, we place the Touch trade about 30 pips above that point. In this instance, the expiry has to be extremely generous indeed: it has to be set to a minimum of 48 hours. It also pays to be generous with the expiry in this case because the nature of the Touch option simply justifies it.

Given how the asset-price is set to head back upwards after the bottom of the saucer, it makes perfect sense to place the No Touch trade some 30 pips below the bottom of the saucer. The expiry can be more generous this time too: 12 hours will suffice, since it’s quite obvious that the asset-price should not hit that target any time soon.

The trading manoeuvres work in a similar manner with a rounding top pattern too. The difference is that the Touch trade goes below the saucer and the No Touch one goes above it in that instance.

The strategy is efficient and in the right hands, it is indeed profitable too. The problem is though that the recognition of the pattern is quite a bit more difficult than just understanding how the whole setup works. It is therefore advisable for rookie traders to put it to the test through a demo account before using it in real money trading.

Learn how autotrading works and get the emotional factor out of your trading game for good!

If You'd Like to Get Notified When This Site is Updated, Subscribe Below...

Leave a Reply

Your email address will not be published. Required fields are marked *

IQ Mining

Binary Option Scams, Warnings, Reviews & Updates...


Popular Articles

Follow Us will not be liable for any damages incurred due to the usage of any information displayed on this website. The information and trading guides found on the website constitute the authors’ opinion only. Trading Forex, Binary options and Cryptocurrencies involve high-risk and are not suitable for all investors. Online trading in general, may not be legal in your jurisdiction. It’s visitors’ responsibility to make sure these entities are legal in their jurisdiction before engaging in trading activity… Read More

Show Buttons
Hide Buttons