Introduction to Binary Options Strategy

Binary Options Strategy

Binary Options Strategy

Over the last few years, binary options trading has developed into a very powerful industry, with hundreds of thousands of traders placing their investments with their favorite brokers while searching for the best opportunities to make a profit. As is the case with any other form of trading, numbers and their behavior play a critical role in the whole process. Traders need tools and methods to reliably predict whether an asset’s value will rise or fall and by how much. In short, they need a sound binary options strategy whose implementation will yield significant profits and help traders achieve high win rates. Because of all that, BinaryOptionsTrading-Review.com has decided to introduce the most popular strategies to its readers in order to improve their chances of striking it rich on the market.

Obviously, asset prices are not set in stone – their values change over time and are influenced by many different factors. A good binary options strategy will take as many of those factors into consideration as possible, so that the probability of unpleasant surprises is reduced to its absolute minimum. However, some basic knowledge of how economy works is certainly required because traders need to be able to extract relevant information from all the data coming their way. Only then can an adequate strategy be applied to predict market trends and win you some serious money at the end of the day. This article will act as an introduction to the world of binary options and serve as a foundation for the more advanced aspects of this type of trading, aspects which will be further discussed in our upcoming articles.

24option Trading Platform

24option Trading Platform

Binary Options Strategy | How to approach trading?

We’ll start our introduction to binary options strategy with a bit of psychology. Psychology plays a major role in this business because traders, especially those who are new to the market, often need to exercise self-control and keep a cool head about their investments. Beginners often experience two emotions which interfere with their decision-making: fear and too much confidence. Other emotional states (such as anxiety, sadness or even fatigue) can also influence your judgment, but the aforementioned two are the most common. Try to analyze your emotional state before you start trading and clear your head before you begin because the rational part of your mind has to be in charge here. A lot of planning and calculating is required to conduct successful trades and if something is disturbing your concentration, the results won’t be as good.

But let’s get back to the issue of fear. As we have already said, this emotion is often experienced by rookies and the reason for that is the fact that they are not 100% certain about their decision. The reason for this insecurity is in most cases lack of knowledge because these traders simply don’t know if they made the right call. They are not familiar with all the tools and strategies that can help them in their particular situation and they gradually become more and more passive on the market because they are convinced they will lose money. Thorough education is the best medicine for this, since you will be able to make the best decision once you know exactly what your options are. Fortunately, every serious broker has a good trading academy designed to help all traders acquire basic knowledge about binary options trading, so we sincerely recommend all the education materials available.

EXPERIENCE AWARD WINNING TRADING ACADEMY

Too much confidence can also be a problem because inexperienced traders often feel a rush of adrenaline when the money starts coming in. Keeping a cool head is especially important in these situations because you don’t want to start investing erratically and jeopardize your winnings. Stick to your binary options strategy at all times – in a place as unstable as the market, you need something to rely on. Patience is the virtue traders will need in order to become successful in this line of work because investing in something which has high payouts but low probability of success will get you nowhere. Take small steps, believe in your binary options strategy and your prize will surely come.

GOptions Trading Platform Gold

GOptions Trading Platform Gold

Binary Options Strategy | Trends and market behavior

Once you’re fully prepared to start trading, both from a psychological and educational standpoint, you log into your account and enter the market. Now what? Well, the first thing you should do is to find an asset you’re familiar with or at least an asset which can be easily checked for more information. For example, if you choose to invest in a particular company’s stocks, it’s always very helpful to know how this company is currently performing because it will be much easier to predict its price that way.

Now, if a price is constantly rising or constantly falling, we are talking about a trend, and identifying one of these is probably the most important thing to do before placing an investment. Almost every basic binary options strategy relies on this and once a trader recognizes a trend, it becomes much easier to predict how an asset’s price will behave. Trends can be bullish and bearish (rising and falling), but keep in mind that they all eventually reach their end, so it’s very important to recognize the signs which tell you a trend is about to reverse. Furthermore, they are not that common, since the market spends more than 50% of its time in the so called consolidation areas, so acting quickly once a trend forms becomes even more important.

Porter Finance Trading Platform

Porter Finance Trading Platform

Recognizing trends and correctly predicting their shifts and duration is the trickiest part of the trading business and those who master this always achieve significant profits. There are numerous tools to help you with that, and most platforms come with their own trend indicators, but caution is still needed, no matter how you look at it. You see, each binary options strategy, no matter how popular, will only instruct you how to be successful most of the time. There is no universal strategy or tool which will bring profit all the time and sometimes you have to endure hardships to come out on top in the end. This is why we said small steps and patience are necessary to become successful in this business – you don’t want to put all your eggs in the same basket.

Binary Options Strategy | Expiration time

After preparing yourself thoroughly and choosing your asset(s), you will need to set an expiration time for your option. An appropriate binary options strategy is needed here, as well, because you need to make an educated guess when your option will be in the money in order to collect your winnings. This is the catch that differentiates binary options from other financial markets and poses a challenge to all traders. To choose a good expiration time, one must examine charts as closely as possible and these charts have to be appropriate for the length of your investment. You won’t extract your conclusion from a one-minute chart if you want your option to expire in a few days. You need a representative sample of an asset’s behavior over a period of time long enough for you to establish a pattern or come to some other relevant conclusion. Once again, we must stress the importance of planning before placing an investment because being familiar with more patterns means having more options on the market.

Banc De Binary Trading Platform

Banc De Binary Trading Platform

Once you come up with a plan for this particular step of the trading process, try not to deviate from it. At least not at the very beginning, until you see which aspects of your philosophy need some tweaking. Stick to your binary options strategy and give it some reasonable amount of time to start producing results. Don’t get carried away if you get off to a good start because the worst thing you can do in this case is to wonder what could’ve happened had you set the expiration time a bit later, thus changing your binary options strategy. Traders become greedy, aim for more and more profit which leads to gradual abandonment of the previously established plan and without it you will have little chance for success here.

Binary Options Strategy | Conclusion

Binary options strategy for successful trading requires a cool head and a lot of planning. The market will test your determination and composure, so no matter what the outcome of your initial trades may be, stick to your binary option strategy. Remember, no strategy is successful 100% of the time. Knowledge is your greatest ally in this business, so research everything thoroughly before you make your first investment. Demo accounts are very useful when it comes to this, because they allow you to see what a certain platform has to offer without risking any of your funds. Furthermore, they are often completely free and should therefore be an indispensable tool in your preparations, since most brokers offer one of these. Preparation, planning and perseverance are the most important prerequisites for making some profit in this business. With them and the tips mentioned in this article, you will surely be off to a good start in your trading career. Pick a broker, open an account and see for yourself why thousands of people from around the world trade binary options on daily basis.

 Max PayoutMin DepositMin InvestmentScore 
24option Logo88%$ 250$ 2495/10024option Review
IQ Option logo90%$ 10$ 195/100IQ Option Review
365binaryoption logo85%$ 200$ 1093/100365binaryoption Review
Binary Options Broker Opteck Logo85%$ 250$ 2591/100Opteck Review
TR Binary Options Logo81%$ 200$ 1090/100QuickOption Review
Boss Capital Logo89%$ 200$ 1089/100Binary Capital Markets BCM Review
ZoomTrader Logo binary options broker83%$ 250$ 1086/100ZoomTrader Review
Author's overall rating:
Author: Ben Prescott
Updated:

RISK DISCLAIMER
BinaryOptionsTrading-Review.com has taken reasonable measures to ensure the accuracy of the information in the website, however, does not guarantee it. The data exhibited in this website is not necessarily always real-time or completely accurate; this includes market analysis, forecasts, signals, assets’ price quotes and charts. Readers should not treat any opinion expressed by the authors of BinaryOptionsTrading-Review.com as a specific inducement to make a particular trade or follow a particular strategy, but only as an expression of their current opinion. The risks involved in trading binary options are high and may not be suitable for all traders. BinaryOptionsTrading-Review.com doesn't retain responsibility for any losses readers might face as a result of using the information presented in this website. This website is owned by Next Media Corp.
In accordance with FTC guidelines, BinaryOptionsTrading-Review.com has financial relationships with some of the products and services mentioned on this website. BinaryOptionsTrading-Review.com may be compensated if consumers choose to click links in our content and ultimately sign up for mentioned products.