Tuesday, July 16th, 2013 by James Franklen
New traders expect a lot from binary options. The expectations are far greater than the trading knowledge they have, or the efforts they make to earn big profit. Binary options trading does not always provide smooth sailing from the get go. The reason is the lack of experience and misconception about trading. So, the question is; what makes people good traders? Let’s find out the answer.
It is a common belief that 50% traders win and 50% loose in binary options. The actual losing percentage is more than that. Only two outcomes (Call or Put) and more than 70% return on each winning trade makes binary option lucrative for everyone. 60 second trading took the emotions further higher. This is the only reason why more than 50% people make errors and lose money in binary options (and some of them give up on binary options). To be successful with binary options trading, here are few things to follow:
There is no place for emotions with any kind of day trading. No matter if you are dealing with binary options or any kind of trading, emotions can harm your trading career.
Ask For Demo Account:
Demo accounts provide you with the opportunity to understand the trading software platform and market events. Ask your broker to provide you the demo account to help you understand the trading mechanism in real time.
Analyze the Market:
Both type of analysis (fundamental and technical) are important with binary options. Technical analysis is used widely because of the sharp movement in price action. If you are looking for some quick trade opportunities, especially 60 second trading options, you will rely heavily on technical analysis. To analyze overall market situation, fundamental analysis are important.
Devise a Strategy:
There is no single formula to use with making money online trading binary options There are many strategies, explained on different forums by well known traders, but still you need to develop your own strategies. This will help you to excel in binary options and be an independent successful trader. Don’t hesitate to risk small portion of your account on devising and developing new strategies. The start can be shaky but the reward will be great.
Make Use of Tools.
Binary option trading requires different tools to be used for better results. For example; price charts give you a better idea to analyze the price movement. For instance, if you are doing a 10 minutes trading, 5 minutes and 15 minutes interval analysis helps you to analyze the direction of the price movement.
There are different indicators available to better understand the market behavious. These tools help in deciding whether to enter or exit from the trades. Few examples of these indicators are Bollinger bands, MACD, RSI, P.SAR, and Stockhastic oscillator.
Observe Market Pull Effect:
All assets do not behave in the same way. An increase in price of one asset can cause the decrease in the price of other asset. Let’s take the example of gold and USD. The market history shows that both gold and US dollar has opposite effect on each other. If dollar (most traded currency) goes up, gold (biggest hedge) prices drop down. So, lookout for such market pulls effect, to take the advantage of the situation.
If all these steps are followed carefully, there is no way you lose money in binary options. Interested in a Binary Options Demo Account? Checkout the Goptions Review and when registering don’t forget to ask for a demo!