Binary Options Team Training Presenter: Matt McCormick * This presentation is meant to serve as a supplement to the Options Domination platform and training. The views and opinions expressed do not necessarily represent those of Options Domination or its management.

About Me  23 Years Old from Michigan  Graduated from the University of Michigan in 2013 (mechanical engineering)  Full-time engineer for the US Government  Joined DSD as a Founder in August 2013 (~$12,000/mon profit, eBay/Amazon dropshipping)  Forex trading experience during high school (successful, but time consuming)

Disclaimer Binary options trading involves significant risk. Although the risk when trading binary options is fixed for each individual trade, the trades are live and it is possible to lose an initial investment, particularly if a trader chooses to place his entire investment to a single live trade. It is highly recommended that traders choose a proper money management strategy which limits the total consecutive trades or total outstanding investment.

Disclaimer You must be aware of these risks and be willing to accept them in order to invest in binary options. Don’t trade with money you cannot afford to lose. This presentation is neither a solicitation nor an offer to buy/sell stocks, futures, commodities, or options. No representation is being made that any account will or is likely to achieve profits. Past performance is not necessarily indicative of future results.

A Quick Note: -Any links discussed are personal affiliate links, and a commission will be generated if you choose to join through them. -While doing so is greatly appreciated, you are not required to use these links to use the platforms.

Agenda  Introduction to Binary Options – how they work  Recommended non-Nadex brokers for each signal type  Placing a trade in a non-Nadex broker  Trading beyond the signal – better entries, avoiding trades  Money Management strategies  The deal with Bonuses – should you accept them?  Understanding Nadex basics  ‘Option’al Q&A Session

What are Binary Options? -A simple question: Will the value of an asset be higher or lower than it is now at some instant in the future? Or (Up/Higher) (Down/Lower) Predictions can be made on Currencies, Stocks, Commodities, and Indices For each individual trade, your risk is fixed Your risk and potential profit is always known before entering a trade

What’s Going On? -Our prediction is outside of the actual market Compare it to a presidential election: We did not actually cast a vote (buy an asset); We just made a wager on the outcome. Thus, we cannot “move the market” (Us)

Binary Options Brokers Remember, no assets are being bought or sold. So how do brokers make money? For non-Nadex Brokers, profit comes when you lose a trade Nadex charges fees when you enter and exit contracts against other traders Profit comes from the payout spread between wins and losses. Ex. Jack and Jill both enter the same trade with an 80% Payout Jack Jill Trade Size: $100 Direction: Call Direction: Put Result: WinResult: Loss Payout: +$80Payout: -$100 Broker Profit = $100 - $80 = $20

Binary Options Brokers Non-NadexNadex - Easy to understand- Higher learning curve - Fixed Risk - Market Maker - Fixed Payout - No Fees (Spread) - Fixed Risk - Variable Payout - Regulated Exchange - Fees on Entry / Exit - More Pairs Available- Fewer Pairs Available - Current Price Entries- Specific Entry Points Available - Layout Matches Signals Due to ease, recommended you start with a non-Nadex broker Lots of ‘bad’ brokers, important to choose the right ones Demo trade on Nadex until you fully using the signals with it

Currency Pairs Explained Slightly different for Binary Options brokers: How a Forex broker typically displays rates -Typically will only display one price, (bid+ask)/2 (check with each broker) -Options Domination signals currently report the target bid price -No spread; Broker profit comes from difference in payout rate

Currency Pairs Explained Terminology How a Forex broker typically displays rates -Pip: The second to last digit in a quoted price -Tick (pipette): The final digit in a quoted price; 1/10 th of a pip In binary options, a single tick is enough to win (or lose) a trade

Currency Pairs Explained  Major Pair: Contains the US Dollar (USD) on one side - EUR/USD - USD/CAD - NZD/USD - USD/JPY - USD/CHF - GBP/USD - AUD/USD  Minor Pair: Does not contain the US Dollar (USD) - EUR/GBP - EUR/AUD - EUR/CHF - EUR/NZD - EUR/CAD- EUR/JPY - GBP/JPY - CHF/JPY- CAD/JPY - AUD/JPY - NZD/JPY- GBP/CHF - GBP/AUD - GBP/CAD Generally speaking, there is more volume on the major pairs (EUR/USD is by far the most traded) Commodities Gold (XAU/USD) Silver (XAG/USD) Oil

What’s A Signal? -Inherently, Up/Down or Higher/Lower are propositions. -With the payout percentages offered by binary brokers, winning just 50% of your trades will result in losses. -A winning signal provides you with a recommended trade that is expected to win at a high enough frequency to generate a profit over the long-term. -Signals are generated by algorithms and/or trading professionals when market conditions are favorable.

Signal Anatomy  Asset: The currency pair, commodity, or stock you will be trading  Direction: Up Arrow = Call, Down Arrow = Put  Strike Price: The price to enter the trade at. You want to get exactly the strike price or better (within reason). Never take a trade at a price worse than the signal strike.  Signal Time: When the signal was generated; In GMT by default.  Expiry Time: When to set the trade to close out.  Date: Day the signal was generated.  Expiry Price: Price at expiry time; Determines if trade won or lost.

What’s A Better Entry? “Same Price or Better” means: - If the OD Signal wins, you win - If the OD Signal loses, you may still win Only enter Calls at the strike price or lower Only enter Puts at the strike price or higher If price doesn’t meet this criteria, STAY OUT OF THE TRADE!! For longer-term trades, you can wait and see if the price becomes favorable again and get in later.

What’s A Better Entry?  A price should only be considered better if it is still likely that the OD signal will win.  Ex: By the time you see a signal for an End of Hour (EOH) Call on the EUR/USD, it has already dropped 50 pips from the recommended strike. Do you take the trade? No!  Possible to take a trade like this on Nadex for a high potential payout if there’s still a lot of time before expiry. RULE: If a signal looks like a clear loser before you have entered, SKIP THE TRADE!

Alright, Lets Take A Trade! If a current Options Domination signal is available, we will analyze and take it. Otherwise, an imaginary signal will be used. For live attendees, this trade is not meant to be executed in any real-money setting. This example is for demonstration purposes only!

Beyond the Signal While the Options Domination Signals have profitable expectation on their own, we can increase our win rate by knowing when to look for better entries or even when to avoid a trade completely. This is optional, but will improve your results!

Avoid the News!  Algorithms scanning the market for favorable set-ups cannot foresee upcoming news releases.  News can cause sudden, unpredictable, and powerful movements that can throw your trade out of the money.  This can be particularly detrimental to trend reversal trades. RULE: If news happened within 20 minutes prior to a signal, or is scheduled to happen prior to expiry, SKIP THE TRADE!

Setting Up Your Charts  Charting software will allow you to see price movement for currency pairs in real time.  Good beginner charting software:  Download and open a Demo account to see charts (don’t fund a live account!)

Reading Candlestick Charts

Technical Analysis You do not have to be an expert at reading charts, but we will go over the basics of: - Trending vs. Ranging markets (Bollinger Bands) - Support and Resistance Lines - Trendlines and Channels - Retracement - Correlations between pairs - Resources to learn more 2 These can all be used as possible confirmation of the OD signals

Trending vs. Ranging Trending Market: - Price is generally moving in one direction - Pullbacks or partial retracements are fine - Uptrend: ‘higher highs’ and ‘higher lows’ - Downtrend: ‘lower highs’ and ‘lower lows’ Ranging Market: - Price is generally moving between specific highs and lows - Not setting new highs or new lows for the time period - Market movement appears horizontal or sideways

Trending vs. Ranging Trending Market:

Trending vs. Ranging Ranging Market:

Trending vs. Ranging RULE: Mean Reversion (MR1, MR2) and Trend Reversal (TR1, TR2) signals work best in ranging markets. If the market is trending strongly, avoid these trades!

Trending vs. Ranging Ok to trade Don’t trade ADX: Average Directional Index, market ranging if it is < 25

Bollinger Bands Bollinger Bands are used to measure a market’s volatility. - Bands contract when volatility is low, expand when it’s high - Bands are flatter when volatility is low, sloped when it’s high  Ranging Market: Narrow, horizontal Bollinger Bands

Bollinger Bands Two main strategies when trading off of Bollinger Bands: 1. The Bollinger Bounce

Bollinger Bands 2. The Bollinger Squeeze

Support and Resistance Support and Resistance lines show horizontal levels in the market that price has trouble breaking through. - Price tends to (but doesn’t always!) bounce off these levels and reverse direction. [the bounce] - When a level is broken, price often continues strongly in that direction. [the break] - Broken support levels become resistance - Broken resistance levels become support

Support and Resistance RULES: Support - Good for Calls - Bad for Puts Resistance - Good for Puts - Bad for Calls

Support and Resistance Broken Support Becomes Resistance Broken Resistance Becomes Support

Trend Lines and Channels  To create a trend line, locate two major tops or bottoms and connect them. (easy!)

Trend Lines and Channels  To create a channel, draw a parallel line at the same angle as your trend line, and move it to where it touches the most recent peak. -Trend lines and channels act as levels of support and resistance -Sometimes price will only be respecting a trend line at either the top or bottom, and the channel won’t apply -The two lines of a channel MUST be parallel

Retracements Very large movements will often ‘retrace’, or pull back in the opposite direction, in the short-term.  Must be sure momentum has stopped before entering a trade  Current candle should close with very little or no wick to retrace  Pay attention to relative candle size  This CANNOT be your only reason to enter a trade. You must pair it with another type of confirmation.

Retracements

Correlations Currency Pairs often correlate with each other. Knowing these correlations, you can gain confirmation for a trade on one pair off of charts for another pair.  As a general rule: -If the USD is on the same side of two pairs, they will usually move in the same direction (ex. EUR/USD, GBP/USD) -If the USD is on the opposite side of two pairs, they will usually move in the opposite direction (ex. EUR/USD, USD/JPY)

Correlations currency-correlation

Money Management  Even if you use every price action tool we’ve discussed along with the OD signals, you will lose trades – Often many in a row!  Our goal is to reduce variance by letting the OD win rates play out over the long-term. Any single trade, or string of trades, can lose…. 2 PLAN FOR IT!

Martingale = Bad - In a Martingale system, you increase your trade size after each loss. (Usually double) -After a win, the trade amount is returned to its original size.  Martingaling cannot overcome a losing system.  Even with a winning system, martingaling can (and will) still wipe out your account.  Though risk of ruin for any single event is small, it is a mathematical certainty to happen eventually. 2 RULE: DON’T DO IT!

The Right Way  Flat trade sizes equal to a fixed percentage of your account balance 1% - 5% per trade -1% is conservative and perfect for new traders -5% is aggressive even for experienced traders -2% is a happy medium once you feel comfortable with the signals and brokers Thus a $1000 account would allow for $20 trades  Recalculate your trade size weekly or monthly, not daily or after every trade

Back to Brokers - Bonuses  Non-Nadex brokers will often offer you a bonus when you deposit  Come in two forms: Deposit Matches (25%-100%+) Risk-Free Trades  By accepting a bonus, you agree to meet a trade volume requirement before you can cash out anything (deposit or bonus)  Typically 30-40X the bonus amount  Can usually be accepted on future deposits, not just your first

Bonuses: When to Accept RULES Before accepting a bonus, you MUST: 1. Understand the trade requirement and exactly what amount it applies to. (varies by broker, talk to you account manager) 2. Not need access to the funds for the next 6-12 months minimum (no withdrawals!) 3. Know that if trading goes south, you could lose the entire deposit (can’t “jump ship”)

Now for Some Nadex  Nadex is a regulated binary option exchange in the United States  Open to the U.S. as well as 40 other countries  Nadex is an exchange, not a broker -Trades are being taken against other traders  Bigger learning curve than non-Nadex brokers, but a very necessary tool in your trading arsenal

Nadex Benefits  Some trades offer much higher payout percentages than non-Nadex brokers, giving you increased profit potential even with a lower win rate  Ability to win trades you might otherwise lose in a non-Nadex platform  Option to close a transaction early and avoiding a late spike against your trade.  Chance to get into trades that are already ‘In the Money’ when you see the signal  Note: Fewer tradable assets

The Contract  On Nadex, there are no Calls or Puts -If we expect price to go Up, we BUY CONTRACTS The buyer thinks the asset will close ABOVE the strike price -If we expect price to go Down, we SELL CONTRACTS The seller thinks the asset will close AT or BELOW the strike price (so a dead tie favors the seller)

The Contract -The value of a contract is ALWAYS exactly $100 -Market conditions determine how much of the risk the buyer and seller each assume Example: If a contract is available to buy for $65, the buyer is risking $65, and the seller is risking $35 If the buyer wins, they will get $100 ($35 profit on $65 risk, 53.8% return) If the seller wins, they will get $100 ($65 profit on $35 risk, 185.7% return)

Nadex Platform

Nadex Terms  Contract: The currency pair, commodity, or stock you will be trading along with the available strike price  Time Left: How long before the contract expires / closes out  Expiry: The date the contract expires  Offer: The price you’d pay if you wanted to BUY one contract  Bid: How much you can SELL one contract for -BIG NOTE: Your risk in this case is $100 minus the bid price  Indicative Index: The actual price the asset is trading at now

Nadex Notes  The price of a contract is roughly in line with it’s probability of winning -Example: If a contract costs $65 to buy, the buyer has approximately a 65% chance of winning the trade  If you don’t like where a price is at, you can set a “Market Order” to execute if it reaches a different amount - If it doesn’t reach your set price, no contract purchase will be executed  You have the option to close a contract early to lock in profits

Nadex Fees  Nadex charges both the buyer and seller of contracts a small commission for the trade - $0.90 fee when you enter a contract, and another $0.90 when you exit. - If you are trading more than 10 contracts on a single trade, the fee is capped at $ If your contract closes ‘Out of the Money’ at the time of expiry, you are not charged the 2 nd $0.90 fee.

Recommended Brokers To take advantage of all of the signals OD offers, it is recommended that you have funded accounts with: 1. At least 2 non-Nadex brokers 2. Nadex

Recommended Brokers  When choosing brokers, track record and ease of withdrawal, and extensive testing are most important RULE: Don’t join any broker just because their payouts or bonuses are higher. Remember there are a ton of BAD BROKERS! Only use those that have been tested and vetted by others.

Recommended Brokers  We want to use the offerings of legit brokers to maximize: 1.Available Assets – We don’t want to miss signal trades 2.Payouts – Greater payout percentages decrease your required win rate and can drastically increase profits 3.Bonuses – If you choose to take a bonus, lower trade volume requirements are extremely advantageous

Recommended Brokers  Goptions: Official recommended broker by OD (haven’t personally tested) Exclusive bonuses with no trade requirements for OD members Typically 48 hour payouts Note: Requirement-free risk free trades only apply on your first deposit, so it may be better to start with other brokers and benefit more from the bonus later when your resources allow. Use the link in your Options Domination back office to qualify for the exclusive bonuses.

Recommended Brokers  Bloombex Reason: Higher payouts on most available assets Much lower volume requirement of 16X on bonuses Personally tested – fast, hassle-free withdrawals Offers PayPal as a deposit and withdrawal option Minimum Deposit: $300

Recommended Brokers  Boss Capital Reason: Large number of assets available at all hours Won’t miss trades on minor pairs, especially at night Good bonus offerings including risk-free trades Demo account available once you deposit Personally tested – fast, hassle-free withdrawals Minimum Deposit: $200

Questions?

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