MightyOne wrote:You will notice that there is a list that reads something like:
GBPUSD to close >1.5000
If you think that price will close higher then you buy
If you think that price will close lower then you sell
If you don't really care, but wish to profit from a rise then buy near the floor.
If the strike is 1.5000 then the floor is at 1.4950 and the ceiling is at 1.5050.
If you could buy at 1.4950 then you would have a zero risk trade because you cannot lose money beyond the floor.
You want to buy as close to a floor as possible and strikes are 20 pips apart so you follow these simple steps:
1. Price is within 10 pips of which strike?
You look down and see strikes at:
GBPUSD to close >:
1.5000, 1.5020, 1.5040, 1.5060, 1.5070, etc
The current price is 1.5034 so it is within 10 pips of the 1.5040 strike.
2. You want to buy so you count upwards two strikes and buy the 1.5070 strike.
Where is the floor of the 1.5070 strike?
1.5070 - 0.0050 = 1.5020 so your risk is 1.5034 - 1.5020 or 14 pips.
So the rule to remember is:
When price is within 10 pips from a strike you buy two strikes higher or sell two strikes lower.
There is a little button on the platform that turns the list into bid/ask boxes by strike level with the number of lots available at each price.
Looks like you're really getting into it mo. Which company are you trading this with? Didn't like BOM?