Best Binary Options Strategy For Beginner & Experienced Traders – Binoption
Traders are constantly in need of a working binary options strategy for their trading.
Without a trading strategy, no trader can achieve success in trading.
Whether it be forex, crypto, stocks, indices, or any other asset, you need a strategy that suits your trading style and brings you consistent profits.
The common misconception among non-traders is that trading is a game of luck. The reality is far from the truth.
Trading is a very complex activity. There is a lot of reasoning behind every action that is performed.
A trader carefully selects his trading asset, analyzes its market, performs technical analysis, and then performs the trade.
Even after all this, the chances of winning are pretty slim. You cannot out predict the market.
Binary Options are based on a yes/no proposition.
Earning a payout depends on accurately predicting the outcome of the market beforehand.
If you guess wrongly, you will lose your investment.
Therefore, it is extremely important you trade with caution.
A trading strategy is the backbone of any successful trade.
Our strategy section contains various articles that will cover all aspects of binary options strategy.
You will learn how to utilize different strategies and when to use which one.
Best Strategy List For Binary Options Trading:
What Is Trading Strategy For Binary Options?
A trading strategy is basically a well-thought out plan that is designed in order to profit from the trading market.
A strategy is formed on the basis of both fundamental and technical analysis.
Fundamental analysis involves analyzing the factors that affect the asset’s market value such as economic and financial conditions, interest rates, company earnings, competitors, and much more.
After analyzing these factors, the asset price will be estimated.
The analyst then compares this estimated price with the current market value and determine if the asset is undervalued or overvalued.
If it is overvalued, the recommendation would be to sell it, and buy if is undervalued.
Technical analysis is the process of analyzing the market through trends and and information collected from trading such as volume and price movement over a certain period of time.
Using indicators and graphical tools, trends are recognized and future price movement is predicted.
When forming a trading strategy, you need to combination of both.
In our strategy guides, we guide you step-by-step, to do exactly that.
The Need For Successful Binary Options Strategy
Though many new comers are of the opinion that there is no need for trading strategies for making money through binary options, this article will help you to understand the real reasoning for the need.
These binary options strategy collectively will help you in understanding and analyzing whether you made profit at the end of each month.
In order to know this, firstly every trader should be aware of what they are doing.
Basically as a trader you should be aware of where the results of your trades are arising from.
Trading without strategies is driven by emotions and will be random.
After certain point of time, you would have either made some money or not.
But there will be no certainty thus you will be unable to be understand what helped you to make or lose money.
This lack of information will be a block for improvement.
This can also result in try different trading styles on a regular basis and will be unable to settle with some style that will surely help you to make some money.
In order to make trading fruitful, learn how to trade binary options.
As you will have clear picture of the amount of money you make and the source for the same, there will be less chance of failure or struggle.
In this way, you can concentrate on those styles of trading that are your strength and can eliminate the chances of you failing.
It is essential to keep in mind, no one is a master in trading binary options nor are they born with the skill of trading.
All these are learnt through information and experience.
However, following some binary options strategy are a tool that will help you to improve your trading overtime.
It can be said that- ‘Only with the help of knowing what you are doing to your trades, you will be able to judge or predict the result of your initiatives”.
To summarize, you will need a working binary options strategy for the following reasons:
- Profitable trading
- Focus on trading without distractions
- Measure and improve performance
- Eliminate emotions from trading
- Prevent over trading
- Enrich your trading knowledge
- Reduce risks in trading
Types of Binary Options Strategies
Binary trading is fast paced with short expiry times. Trade duration varies from 60 seconds to 1-2 days.
With such short time, it is better to adopt active trading strategies.
There are many strategies available for binary options trading.
Here, we will cover the basic ones that are used most frequently.
You will find the more advanced and specific strategies in our articles.
Here are the common active trading strategies used in binary options trading:
This is the most common form of trading and is not just limited to binary trading.
Day trading is the form of trading where you open and close your trade positions within the same day.
The position is not extended by holding it overnight.
Trading binary options this way has its benefits. You don’t have to worry about overnight risk and day-to-day price fluctuations.
For new traders, day trading is an easy strategy to adapt to.
Swing Trading, also known as momentum trading, involves trading those assets which are trending.
All you need in this form of trading is following the trendline.
Swing traders aim to profit from the price changes of the asset.
The price changes can be upwards (bullish) or downwards (bearish).
They enter the trade when the trend starts and exit when they have scored their required profits.
Identifying the trend involves technical analysis using indicators like RSI and MACD.
Scalping, as the name suggests, is trading strategy used to earn profits from minuscule price changes.
This type of trading is quick and you need to act quick to secure your profits.
As such, we wouldn’t recommend novice traders to start with this strategy over others.
However, the risks are lesser as only small positions are opened using this strategy.
Scalper use 1-5 minute trading charts and perform many trades, sometimes up to hundreds of trades.
Each time, the focus is to earn small profits.
A common trick used by scalpers is to profit off the changes in the bid-ask price of an asset.
Position traders are usually long term traders, who hold positions for long periods of time.
This strategy may seem in direct contrast to the principle of binary trading, but it can be used in active trading as well.
Long-term position traders will use indicators such as 200 EMA to identify the long-term trend.
For binary options, 10-day moving average or even hourly averages will be more effective as the trading is short-term.
Position trading is less stressful than swing or day trading as it needs less attention to pay to.
However, the win-rate of this strategy is also lower compared to other strategies.
Hedging is something that is not unique to binary trading. It is rather used by all forms of trading where you can open a position that is opposite to yours.
Hedging simply is a risk reducing strategy where you hedge your initial position by opening another position in the direction opposite to that of the original position.
This may seem counter-effective on the surface, but in reality, it is quite difficult to always win a binary trade.
For example, if you bought a call option for Tesla share anticipating a price increase, you would sell a put option to hedge.
If your initial prediction was incorrect, you would lose the trade and your hedged position would recover your loss.
How To Choose The Right Trading Strategy?
Novice traders often search for the best binary options trading strategy.
They keep switching from one strategy to another in search of the perfect one.
The harsh reality is that no trading strategy is perfect.
The perfect strategy differs from trader to trader.
What works perfectly for you may not work work at all or someone else.
Your perfect strategy is the one that suits your trading style and personality.
Keeping this in mind, there are three main things in mind when you are choosing a trading strategy. They are:
Complexity isn’t a measure of effectiveness.
In the case of binary options strategy, simpler the strategy, easier it is for traders to execute it.
New traders should stick to simple strategies so that they can focus on other aspects of trading.
It is often the simple strategies that work the best.
Even traders who deal with large positions prefer to use not more than 1-3 trading indicators for forming their strategy.
Traders form strategies to ensure success in trading.
A winning strategy should result in winning more trades than the average trader does.
Win rate is a metric of measuring a strategy’s effectiveness.
Most binary options brokers offer payouts in the range of 70-90%.
That means your win-rate should be at least between 50-60%.
If the trading strategy isn’t bringing you the bare minimum results. you should consider switching to other strategies.
You have to factor in the risk level that your strategy presents.
You need to prepared to undertake the risks that are involved with the strategy.
Some strategies have unlimited risks, while some have a max loss amount.
You need to be emotionally committed to face the losses in case you lose your trade.
This is why you need to choose a strategy that suits your level of risk preference.
Binary Options Winning Tricks
Without having any binary options strategies for trading if you are just relying on luck, then it is betting.
Binary options can used as a betting tools as well as a very well analyzed trading tool.
While betting on binary option there is high chance of losing the complete investment;
However if you are trading with binary options strategy, techniques and tools certain events can be predicted and thus the chances of loss is low.
And even in case of loss the amount will be very minimal or negligible.
The best trading strategies will help you strike deal that are profit making and will also guarantee return on your investment.
Temporary results and success should not be the target of any trader.
You should be able to think above and beyond temporary success.
Play the cards well to be successful in life, instead of just concentrating on making money.
Some of the useful tips for binary option trading are listed below; make use of these to be successful in the long run.
- Research before investing.
- Make use of the mobile application for tracking any trading activities.
- Have more than one broker for trading.
- Look for the features and facilities offered by the brokers and do a comparison. You can check our broker comparison page.
- Learn how to use signal.
- Be smart to interpret trading charts and graphs.
- Have long term investment goals and invest money accordingly.
- Learn binary options trading the right way.
- Don’t try to the make money through shortcuts, this will lead to loss of the whole investment.
- Get to know about binary option trading. In this case you can see our guide section.
- Be willing to learn and invest time for the same.
- Be prepared to spend time for trading activities on a daily basis.
- Strike a balance between personal and trading life.
- Don’t break your long term investment with the current market situations.
Through this way it is easy to track your trading activities and accordingly decide if there is any need for further investment or if what is there is itself sufficient to generate results as per expectations.
That being said, it is important to have realistic expectations, don’t expect your money to grow exponentially within a couple of months.
The happiness of success lies in each trader’s hands. The more realistic the expectation is, the chances of you being successful increases.
Binary Options Strategies can be as many as you need, but using the right strategies at the right market condition for right type of trades matters.
Of course, there are lots of easy ways to get preset and formulated strategies from various sources.
Simply going by the cost and return percentage will not guarantee results for your investments.
Each trader is different and similarly their trading styles also differ.
Simple copying something blindly is more like trial and error that will not guarantee results.
It is said that it’s impossible to be a long term successful binary option trader without a trading strategy.
Mastering technical skills is quite essential and is a major part of binary education.
When it comes to trading this methodology is never avoided.
Everywhere you can find that it is important to have knowledge on binary option trading and learning the basics is not a tough job.
But many still have the question like what topics should be covered while learning and which are important ones that are essential.
Binary Options present a great opportunity for traders to earn huge profits in a relatively short period of time.
The prerequisites of success in trading are trading knowledge, working strategy, trading with a legit broker, proper risk management, and the right mindset.
These combined will ensure your success rate is the maximum.
We have presented many binary options strategies here.
Some strategies are specifically designed for new traders.
These are effective but there are far more advanced strategies for experienced traders.
Our advice would be to test out these strategies in a demo account first.
Keep in mind that, with the passage of time, your trading strategies will also have to change.
Adaptability is one of the traits of a good trader.
As we keep experimenting with formulating new strategies, we will update the strategy section.
You can contact us for any inquiries related to the strategies presented here.
We hope you benefit from the strategies and enjoy profitable trading!