Binary Options Trading Using Murrey Math Lines
Murrey math lines are a great way to plot some artificial pivotal predictive lines on your chart for trading at the start of the next GMT trading day. You can see that our Multi Swing Profiler and our FRB Contrarian Binary Options strategy both incorporate Murrey math lines. We love some of the popular artificial lines that are popular among active and professional traders because often newer traders are challenged with where to properly draw support and resistance lines on a chart and these lines are derived from a predefined formula to predict 8 critical areas that hypothetically will encompass all the price action for the coming day. Since we are publishing so much content centered around Murrey Math lines I decided to write this Binary Options Tutorial and cover all the theory surrounding these 8 lines as well as the 2 outer most lines above and below them. After reading this Tutorial you may come up with even more ideas for using our Multi Swing Profiler in your Binary options trading.
We Recently Added a Video to explain and illustrate Murrey Math lines that we hope adds insight for visitors reading this article. Make sure to Check it out because it compliments the this article.
Murrey math theory made simple:
OK before I break these lines down in pairs I need you the reader to relax and don't over stress remembering the rules for each line. Instead think of these pairs as points on either side that will wrap around all the price levels of that day starting from the widest out into the last pair before our jewel of the 4/8 line that represents the perfectly balanced market with just as many sellers as there are buyers. Visualize that 4/8 line as the center of a see saw and as price moves up or below it that balance of buyers and sellers on the day is tilted taking the market in that direction. OK now here is the theory broken down into lines but remember to not just memorize lines like they are parts of a song and instead remember the concepts I just shared because they define what kind of song you are hearing the market sing to you.
Murrey Math Lines 0/8 and +1/8: lines are the ultimate resistance and support lines for the current new day these lines should be very hard to break.When the market breaks out of either side of these lines above +1/8 or below 0/8 then it is likely we are in for a volatile breakout day in that direction on that day.
Murrey Math Lines 1/8 and 8/8: lines are weaker support and resistance lines for the current day but if the price stopped near them that could be it and we may get a reversal on the day.
Murrey Math Lines: 2/8 and 6/8: These lines are thought of as strong reversal points as well and after crossing our Central point of 4/8 they are the first lines of defense before a really strong breakout.
Murrey Math Lines 3/8 and 5/8: Are the bottom and the top of the average trading range respectively; it is very likely that price contained in these lines will pierce one side fast after prolonged sideways trading between these lines.
Murrey Math Line 4/8: This is a major support and resistance line that separates a Bull Market on the day when price is trading above 4/8 and a Bear Market on the day when price is trading below the 4/8 Murrey math line. For this reason often many traders will go long or short on the day depending on how price reacts after breaching this central point.
Murrey Math Lines 7/8 - 8/8: This is not particularly popular Murrey math theory instead it is an observation based on our perception of the charts and trades we have done over the years. The level of 7/8 and 8/8 will often see a stall in price and some sideways trading but can often be followed by a healthy breakout to the upside for the day if enough congested trading in this area has been built up similar to the 3/8 through 5/8 area mentioned earlier.
That is it Murrey math lines made simple and using some of the ideas shared here you can see how they can serve as excellent artificial support and resistance lines for your binary options trading as price oscillates up and down throughout the trading day.