Higher/Lower: Trading Against the Barrier

Rise/Fall Contract:

• Reference Point: Entry Spot (the price when you buy)
• Fixed by the market
• You adapt to the market's timing

Higher/Lower Contract:

• Reference Point: Custom Barrier (the price YOU define)
• You set the offset (e.g., +1.5 points or -0.8 points above/below current price)
• The market adapts to YOUR target

Example:

• Volatility 75 currently at 45,250
• Rise/Fall: Compares Exit Spot to 45,250 (locked)
• Higher/Lower: YOU set Barrier at 46,000 or 44,500 (your strategic choice)

You define the Barrier by using an offset - a number of points/pips above or below the current market price.

Positive Offset (+): Barrier above current price

• Current: 45,000
• Offset: +500
• Barrier: 45,500

Negative Offset (-): Barrier below current price

• Current: 45,000
• Offset: -500
• Barrier: 44,500

Platform Calculation:

Barrier = Current Price + Offset

The platform automatically calculates and displays the exact Barrier price before you execute.

Higher: You win if Exit Spot > Barrier (strictly)

• Barrier: 45,000
• Exit Spot: 45,001 ✅ Win
• Exit Spot: 45,000 ❌ Loss (tie = loss)
• Exit Spot: 44,999 ❌ Loss

Lower: You win if Exit Spot < Barrier (strictly)

• Barrier: 46,000
• Exit Spot: 45,999 ✅ Win
• Exit Spot: 46,000 ❌ Loss (tie = loss)
• Exit Spot: 46,001 ❌ Loss

Critical Rule: If the Exit Spot equals the Barrier, the trade is a loss, not a push or refund.

✅ Higher Success

Price ends above barrier = Win

❌ Higher Failure

Price ends below barrier = Loss

Understanding Higher Predictions:

• Success: When you predict Higher and Exit Spot is above the custom Barrier
• Failure: When you predict Higher but Exit Spot is below the custom Barrier
• Visual Indicators: Clear success/failure outcomes shown in the diagrams

✅ Lower Success

Price ends below barrier = Win

❌ Lower Failure

Price ends above barrier = Loss

Understanding Lower Predictions:

• Success: When you predict Lower and Exit Spot is below the custom Barrier
• Failure: When you predict Lower but Exit Spot is above the custom Barrier
• Visual Indicators: Clear success/failure outcomes shown in the diagrams

The Golden Rule:

The further away you place the Barrier from the current price, the harder it is for the market to reach. This lower probability translates into a significantly higher fixed payout. Conversely, placing the Barrier close offers a lower payout but a higher chance of success.

Probability Impact:

Real Example (Volatility 75 at 45,000):

• Trade A: Barrier at 45,200 (+200), Payout 65%
• Trade B: Barrier at 46,000 (+1,000), Payout 140%
• Trade C: Barrier at 47,500 (+2,500), Payout 280%

The difference: Trade C offers 4.3x the payout of Trade A, but only ~25% win probability vs ~65%.

Close Barriers (Conservative):

• Use when: High confidence in direction, want high win rate
• Distance: ±100-300 points from current price
• Payout: 50-80%
• Win Rate Needed: 56-67%
• Example: Support/resistance bounce plays

Moderate Barriers (Balanced):

• Use when: Moderate confidence, balanced risk/reward
• Distance: ±500-1,000 points
• Payout: 90-140%
• Win Rate Needed: 42-53%
• Example: Trend continuation plays

Far Barriers (Aggressive):

• Use when: High volatility expected, trading extremes
• Distance: ±1,500-3,000 points
• Payout: 150-300%+
• Win Rate Needed: 25-40%
• Example: Post-news volatility, breakout scenarios

Risk is Limited:

• Maximum Loss: Your stake amount only
• No margin calls: Cannot lose more than you invest
• No slippage beyond stake: Payout is fixed at purchase
• Barrier tie risk: If Exit Spot = Barrier, you lose (not a push)

Risk Management Rules:

1. Never risk more than 1-2% of account per trade
2. Do not chase high payouts (200%+) without statistical edge
3. Calculate implied probability before every trade
4. Factor in volatility - do not set barriers right at support/resistance where price might consolidate

Reward is Fixed but Amplified:

• The reward is fixed at purchase (no partial profits)
• Payout percentage can be highly amplified by choosing a challenging (far-away) Barrier
• Range: 40% (very close barrier) to 400%+ (extreme barriers)
• Amplification Strategy: Distant barriers allow you to risk $10 to win $40-50 if your analysis is correct

Example Profitability:

The Math: (Win Rate × Payout) - (1 - Win Rate) = Edge

• Example: (0.35 × 2.00) - (1 - 0.35) = 0.70 - 0.65 = +0.05 edge (5% per trade)

1. Targeting Key Technical Levels

Scenario: EUR/USD is at 1.0850, strong resistance at 1.0900 Strategy: Set Barrier at 1.0900, trade Lower (betting price stays below resistance) Duration: 15-30 minutes Logic: Resistance acts as rejection zone, high probability price stays below Example Payout: 85% (moderate probability)

2. Trading Extreme Volatility Expectations

Scenario: NFP report in 5 minutes, Volatility 75 at 45,000 Strategy: Set Barrier at 47,000 (+2,000), trade Lower OR at 43,000 (-2,000), trade Higher Duration: 5-10 minutes post-news Logic: Massive price move expected, but unlikely to reach extreme barriers Example Payout: 220% (low probability, high reward for correct extreme call)

3. Support/Resistance Bounce Plays

Scenario: Volatility 100 bouncing off 55,000 support for third time Strategy: Set Barrier at 54,800 (below support), trade Higher (betting support holds) Duration: 10-15 minutes Logic: Support has held twice, high probability of third bounce Example Payout: 70% (high probability, moderate reward)

4. Range-Bound Trading

Scenario: Volatility 75 oscillating between 44,500-45,500 for 2 hours Strategy:

• When near 44,500: Set Barrier at 44,400, trade Higher
• When near 45,500: Set Barrier at 45,600, trade Lower Duration: 5-10 minutes Logic: Range-bound markets respect boundaries until breakout Example Payout: 60-75% per trade (multiple trades as price bounces)

• Highly volatile, unpredictable markets: Random spikes can hit distant barriers unexpectedly
• Right before major news: Impossible to estimate distance accurately
• Illiquid assets/times: Erratic movement makes barrier distance unpredictable
• Uncertain market direction: If you only know direction (not distance), use Rise/Fall instead
• Barriers too close to pivot points: Price consolidating at barriers creates tie-loss scenarios

Step 1: Select Contract Type

• Navigate to Trade → Options → Digital Options
• In contract type dropdown, select "Highs/Lows"
• Then select "Higher/Lower"

Step 2: Define the Barrier (MOST CRITICAL STEP)

• Locate the "Barrier offset" input field
• Enter your offset value:
  • Positive value (+1.00) = Barrier above current price
  • Negative value (-1.00) = Barrier below current price
• Platform calculates: Barrier = Current Price + Offset
• Visual confirmation: Platform shows exact Barrier price AND draws Barrier line on chart
• Always verify visually before proceeding

Step 3: Set Duration and Stake

• Choose expiry: Ticks (5, 10, etc.) or Time (1 min, 5 min, 30 min, etc.)
• Enter stake amount (e.g., $10)
• Platform instantly displays:
  • Exact Barrier price
  • Payout percentage (this is your probability signal!)
  • Potential return

Step 4: Choose Direction (Higher or Lower)

• If Barrier is BELOW current price:
  • Click "Buy Higher" (predicting Exit Spot > Barrier)
• If Barrier is ABOVE current price:
  • Click "Buy Lower" (predicting Exit Spot < Barrier)

Critical Note: The choice defines which side of the Barrier is the win zone, not necessarily the direction from your Entry Spot.

Step 5: Execute and Monitor

• Final review: Barrier price, Direction, Duration, Stake, Payout %
• Click "Purchase" to execute
• Trade appears in "Portfolio" tab
• Monitor: Current price vs Barrier (shown on chart)
• At expiration, platform automatically settles

The "High Payout/Distant Barrier" Strategy:

Objective: Exploit low-volatility periods with high payout bets on continued consolidation.

Setup:

• Asset: Volatility 100 Index
• Current Price: 50,000
• Market Condition: Ranging between 49,500-50,500 for 45+ minutes (tight consolidation)
• Analysis: Low volatility likely to continue for next 10-15 minutes (statistical probability)

Execution:

1. Set Barrier offset: +2,500 (Barrier = 52,500)
2. Direction: Buy Lower (betting price stays below 52,500)
3. Duration: 15 minutes
4. Stake: $10 (1% of $1,000 account)
5. Payout: 230% ($33.00 return, $23.00 profit)

Logic:

• Barrier is 2,500 points away (+50% from current price)
• In current low-volatility environment, price spiking +50% in 15 minutes is statistically unlikely
• High payout (230%) compensates for the small risk that volatility suddenly explodes
• Implied probability: 1 / 3.30 = 30%
• Your edge: Historical analysis shows this consolidation type stays within 40% range 85% of the time

Risk Management:

• Only use after 30+ minutes of confirmed consolidation
• Never chase 200%+ payouts without statistical justification
• Limit stake to 0.5-1% of account (high payout ≠ low risk)
• Set mental stop after 3 consecutive losses (strategy invalidated)

Objective: Experience how Barrier distance directly affects payout and understand probability signals in real-time.

Instructions:

1. Switch to Demo Account on Deriv platform (use virtual money, zero risk)
2. Select Volatility 75 Index (consistent movement, ideal for learning)
3. Place Trade A:
   • Barrier offset: +200 points (close barrier)
   • Direction: Lower (predicting price stays below)
   • Duration: 5 ticks
   • Stake: $10
   • Note the payout % (likely 55-65%)
4. Immediately Place Trade B:
   • Barrier offset: +500 points (moderate distance)
   • Direction: Lower (same prediction)
   • Duration: 5 ticks (same as Trade A)
   • Stake: $10 (same as Trade A)
   • Note the significantly higher payout % (likely 95-115%)
5. Place Trade C (Advanced):
   • Barrier offset: +1,000 points (far distance)
   • Direction: Lower
   • Duration: 5 ticks
   • Stake: $10
   • Note the payout % (likely 160-200%+)

Reflect:

• The difference in payout represents the market's calculated difference in probability
• Trade A: High probability, low payout (safe)
• Trade C: Low probability, high payout (risky)
• Which Barrier placement gives you the best risk/reward balance?
• Is the higher payout justified by the reward in your current market analysis?

Key Lesson: Payout % is your probability signal. Trust the math, not your emotions or payout attraction.