Binary options are always subject to skepticism because they’re “prone to fraud,” and “uneducated speculation.”
The fraud claims might have merit if you’re using a shady broker, but the uneducated speculation is pure ignorance how binary options work.
Trading binary options can yield respectable amounts of money – if you know what you’re doing.
It isn’t something to go into blindly. Knowing proven binary trading strategies is crucial to succeeding in the market.
Binary Trading Strategies: Signal Speculation – Tips 1 & 2
Signals are what binary traders call indications that an asset price is about to rise or fall.
They can include really any knowledge but usually revolve around news events or technical analysis.
News events are where most new traders get their market information. MSNBC and the like often cover markets where binary assets are traded.
Company announcements, stock changes, currency values, etc. are all valuable information if you’re trading binary options.
At the basic level of analyzation, good news prices will rise while bad news means prices will fall.
Deep analysis involves following economic calendars, monitoring a company, currencies, and quarterly earnings reports.
News speculation is essentially taking what information you can find on your market and hedging your bets based on what market experts predict will happen.
Technical analysis ignores current market fluctuations in favor of looking how asset prices moved in the past.
Traders look at current market conditions of a particular asset and compare them with that asset’s conditions in the past.
If history says the asset prices falls, then you bet it will fall. The idea being that patterns emerge and will repeat themselves based on market predictability.
This holds true for any type of trading. Putting all of your capital into one trade ensures you win big, or lose big.
This can also mean trading on multiple assets within the same market. For instance, two different currencies.
Keep speculating on low-risk assets that make consistent money, and use your extra funds to take risks.
#4: Five Minute Strategy
The five-minute strategy is the first and foremost of the binary trading strategies. If you’re just start off, read this carefully.
This strategy works based on the premise that many brokers allow traders to buy options five minutes before they expire.
Sharp traders will pick through the asset market and find those about to expire. Then, they check those asset’s market stability.
If the market is stable (meaning growth won’t change over five minutes) you can place your trade and easily make money.
These types of trades can help make up the “safe” component of your diversification strategy.
Let’s say you place a $25 dollar trade on an asset and lose. The Martingale strategy says your next bet has to double your previous.
So, now you’re trading $50. You lose again. Now you have to double your total loss. That’s $25+$50 = $75 *2 = $150.
This idea is to use market research to eventually place a successful trade.
After a success, you’ll not only recoup all of your losses but also see more return than you would have with your original small trade.
Binary trading is tricky, but with the right market strategies, you can see long-term success.
Keep these 5 binary trading strategies in mind the next time you have the itch to start day trading.