10 Golden Rules Of Binary Options Trading

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10 Golden Rules Of Binary Options Trading

I’ve found a very brief, but very true article online. I can not remember where I found it, but here it is. It talks about 10 rules that were written for stock market trading, which is not too different from binary option trading, so we can use these rules and apply them for our options trading.

An excerpt from this eBook:

Just because the Forex market is online twenty-four hours a day does not mean that you have to trade all that time. If you are doubtful, do not trade at all. Instead, analyse the market and use the knowledge you get to make more profitable trades in the future.

10 Golden Rules eBook

The truth about Forex is that it’s a very intense and stressful activity that requires a complete control of emotions. Forex is merely an unrealized idea of “get-rich-quick”. Learning to trade Forex will require patience. Mastering the basics will, of course, require some time. Those not disciplined enough and impulsive will soon find themselves “loosing one’s shirt”. Those of you, that don’t follow the basic investment principles or those that can’t control their emotions, will soon find themselves loosing their investments. However, those of you who will follow the given investment principles will benefit greatly on the most variable and liquid markets. 100% return on investment within couple of days,won’t be anything extraordinary and actually 1000% return wouldn’t really surprise an experienced trader. It is well-known that Forex has become the most popular way of investment. As with any other company, even Forex has its own rules. Learn Forex, strive for success and make wise decisions. Our small book will introduce you to the 10 golden rules on Forex trading that every beginner should follow, if he wants to succeed.

  1. The market is always changing and these changes are sometimes really hard to follow. For the start, it is not a bad thing to use these changes for your own good, until you won’t be thoroughly prepared to trade on Forex.
  2. There are a lot of novice traders that trade in various directions. You have a great chance to make a profit on both upside or the downside of the trade. Trading in the direction of the trends give you a chance to make the best trades and increase your chances to win.
  3. Set up a demo account to thoroughly understand the Forex trading. Using the demo account will give you a chance to try how the real trading works and will also prepare you for it. On the other hand, it wouldn’t be a bad thing to stay realistic and always remember that using your demo fund require the same caution as operating the real funds. Otherwise trading on the demo account doesn’t have any point.
  4. There are a lot of companies making various programs aimed at predicting future trends. However the question is, if this program would really work, why would these companies share it? These kind of an opportunity or a secret is not normally publicly shared, is it?!
  5. Trading requires a lot of nerve and you’ll come across a lot of obstacles that will set you back to the beginning. The moment your emotions take over, it’ll force you to open the trade too early and eventually lead to a loss.
  6. There is no need to trade 24/7, even though you can do so, on Forex. If you have any doubts, it’s better to not trade at all. It’d be better to continue your analysis of the market to get the necessary skills that will make your trades more profitable.
  7. Because trading is a very emotional activity, you have to prepare your strategy. It’s necessary to follow the rules to protect you from yourself.
  8. Avoid complicated strategies that require a lot of complicated techniques. They will only make you more confused and you’ll miss a lot of good trading opportunities.
  9. Leverage can make you a lot of profit on Forex, but it also brings a great potential risk to loose your capital. As a novice, never risk more than 1-2% of your margin account. In the case of a long-term trade, it’ll provide you with a great profit and minimal risk of loosing your investments.
  10. Learn to habitually analyse both of your trades, the successful once and the once you’ve lost. This will give you an idea what it was that made the trade successful and you’ll be able to use it continually in the future.

It is true that these are the most basic rules for trading, but they are really necessary. If you enjoyed this book, make sure to leave us a comment below the article.

Author

More about the author J. Pro

Unlike Stephen (the other author) I have been thinking mainly about online business lately. I wasn’t very successfull with dropshipping on Amazon and other ways of making money online, and I’d only earn a few hundreds of dollars in years. But then binary options caught my attention with it’s simplicity. Now I’m glad it did because it really is worth it. More posts by this author

Binary Options Trading Strategy – Best 60-Seconds Strategies

Today we are going to share our binary options trading strategy with you. This strategy is designed to help you identify whether you’ll like trading binaries and teach you how to trade binary options the right way. If you prefer to play it safe over gambling, you’ll need a strategy or tactic to help you master binary options and other trading activities. This is where our TSG team comes to the rescue. We will provide you with the best binary options strategy.

The main reason we’re interested in learning about trade binary options is the fact that binaries simplify what we’re already doing in Forex. At the same time, binary options also allow us to make more money in the process. We are also controlling the risk.

Binary options are easy to understand. This is coming from someone who has little or no experience in the area. If your favorite approach to trading forex is to jump in on a fast price movement and ride the intraday trend for as long as the momentum lasts, you can learn how to make money trading binary options very quickly.

When we first discovered binaries, the light bulb in our heads turned on. We figured out the same thing that we’ve been doing in Forex can be done. But walk away with 75%, even 95% winning trades because we only needed to get the direction right. No need to worry about how many pips we could grasp in the process.

And that, my friends, is the real beauty of binary options.

What are Binary Options?

Binary options are a form of derivatives that have a fixed profit or loss. Trading binary options is simple. All you need to do is ask yourself a simple yes or no question. Will the price of the underlying asset be worth more than the strike price at the expiration date?

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Now, let’s start by understanding how binary options work.

Essentially, we can trade binary options for any type of instrument. Whether it be commodities (Gold, Oil or Silver), Forex exchange currencies (EUR/USD, GBP/USD or USD/JPY), or stocks (Amazon, Tesla or Twitter).

So, the first thing you need to decide upon is to select the asset to trade.

Second, before submitting our trades, each of these instruments has a current value at any given point in time. How to trade binary options depends on our trading skills. It is used to predict where the current value will be some time in the future. In other words, we must use our skills to predict the market direction. This will determine our success in trading binary options.

The market can only go up or down. If we believe the current value will go up in the near future, then we buy a Call option. On the other hand, if we believe the current value will go down in the near future, we buy a Put option. Read more about call options vs put options.

Third, we need to determine what the most critical aspect of trading binary options is. The expiration time will ultimately determine if you’re making a profit or not.

Trading binary options require you to correctly forecast two things:

  1. Whether the market will rise or fall.
  2. Your forecast needs to be accurate during a certain time frame – called the expiration time.

If you’re right on the market direction by the time of the expiration time, you earn a profit. Being wrong means you incur a loss. The way binary options works is that if you’re right on the market direction, you’ll get a percentage of what you initially invested in.

Typically between 75% and 95% and in some cases, even 100% of your initial investment, depending on your Binary Options Broker.

Supposing we’re wrong on the trade, then we’re going to lose the whole amount invested in the short term.

We have made a nice infographic that highlights the four steps on how to master binary options trading.

Now we’re going to focus on step two, which is how to predict the price movement. If you manage to figure this out, then knowing how to make money trading binary options will be a piece of cake for you.

Now, before we’ll outline a method on how to make money trading binary options, we always recommend taking a piece of paper and a pen and take notes on the rules of the best binary options strategy.

In this demonstration, we’re going to look at the buying Calls.

The Best Binary Options Strategy

Our team at Trading Strategy Guides is ready to share with our beloved trading community our 60-second binary options strategy. We don’t just hope this strategy will make you money, we’re certain it will. The mathematical model behind this binary options trading strategy has a proven market edge.

The only tool you need to trade binary options successfully is the RSI indicator.

Even the RSI indicator is not good enough if it doesn’t have the “right” settings. The RSI default settings need a little bit of adjustment if you want to master the 1 minute time frame. We use a 3-period RSI to trade binary options profitably.

Naturally, a lower RSI period means that the indicator will tend to be noisier than normal. But it is more responsive to the immediate price action. Along with the RSI settings adjustments, we also played around with the overbought and oversold readings. We found out that by using an 80 RSI reading for overbought and 20 RSI reading for oversold condition, we get more accurate day trading signals.

*Note: Make sure you adjust the RSI settings before you jump into the binary options trading strategy.

By changing the RSI overbought and oversold line, we have eliminated the noise. So now we’re ready to highlight our binary options step-by-step guide:

Step #1: Find an instrument that is showing a low the last 50 candlesticks. Use the 60-second chart (1 Minute TF)

The 1-minute binary options or the 60-seconds time frame is the best chart for trading binary options. In other words, the best binary options expiration time is the 60 seconds time frame.

We recommend highlighting the starting point on your charts. And the ending point of your 50-candle low that you have identified. Simply draw two vertical lines on your chart through the starting point and ending point of your 50 candle low.

When you count the 50 candle low, you should always start from the current candle. Then go from the right side of your chart to the left side of your chart. If you manage to count 50 candle low, obviously the starting candle point will be your 50 candle low.

Moving forward, it’s time to put the RSI indicator in use and spot if we have extreme oversold reading or not.

Step #2: At the moment the 50 candle low develops, we need an RSI reading of 20 or below

Since this is a reversal trading strategy we need the RSI indicator to show a bullish reversal signal. An RSI reading below 20 shows that the market is in oversold territory and it can potentially reverse.

In our example below, the 1-minute EUR/USD chart is satisfying the two conditions.

Keep in mind that in order to move to the next step, we need the 50 candle low. We also need an RSI reading below 20 to happen at the same time.

We added one more factor of confluence that needs to be satisfied. If used in conjunction with the previous two conditions, it will make you a money maker binary options trader.

Step #3: Look for a bullish divergence to develop between the RSI indicator and the price.

When trading reversals, you need to be as precise as possible. The more confluence factors you have in your favor the more accurate the reversal signal is.

What we need to see here is for the price to continue moving lower after the 50 candle low was identified. At the same time, we need the RSI indicator to move higher in the opposite direction.

If the price moves in one direction and the momentum indicator moves in the opposite direction, it means they are diverging from each other. This signals a potential reversal signal.

Now it’s time to highlight how to find the right entry point for the binary options trading strategy.

Step #4: Buy a Call Option after the first candle that closes above the high of the 50 candle low

The first thing you need to do is to mark on your chart the high of the 50 candles low with a horizontal line. The first candlestick formation that breaks above this high is your trade entry signal to buy a 60-second Call option.

It’s that simple!

After you decide the amount to invest and pick the 60-seconds as your expiration time, it’s time to sit back and wait 1 minute before hopefully collecting your profits.

Step #5: You collect your profits if the next candle closes higher than your trigger candle

If at the expiration time, the price is higher than the price you opened your Call binary options, you’re lucky because you’re about to check-in a big payout.

For example, if you’ve invested $1,000 and your binary options broker offers you an 85% payout, it means that you accurately predicted the outcome of a trade. You get back your initial investment of $1,000 plus the 85% payout which in our case is $850 in profits.

If you want to buy Put binary options, use the same binary options guide, but in reverse.

Conclusion – Binary Options Trading Strategy

Before learning how to make money trading binary options you need a great Binary Options broker. You can’t start hitting home runs right out the gate without making sure you have a binary options broker who wants you to succeed. Secondly, you need a strategy based trading technique to reveal the market direction. You only need to forecast if the price will be up or down during the next 60 seconds, making it very convenient.

We use a heuristic approach to speculate on which way the price is going to move during the next 60 seconds. At the end of the day, traders are looking for a reliable binary options system that will help them make money from trading.

The good news is that the best binary options strategy is exactly that system. Our team is built of many traders with experience in the industry, including binary options traders who know how to make winning trades. We’re ready to help you with every step of the way.

Thank you for reading!

Also, please give this strategy a 5 star if you enjoyed it!

Don’t forget to read our guide on regular options trading for beginners here.

(58 votes, average: 4.29 out of 5)
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Three Fibonacci Rules For Binary Options Traders

Fibonacci Retracements are a very useful tool and one that is part of my regular technical analysis. This tool is one based on thousands of years of mathematical observations originating in ancient Indian mathematics. Although he did not invent the number Fibonacci did a lot to bring it into widespread knowledge in middle aged Europe. The Fibonacci number, or sequence, is a derivative of the Golden Ratio and a phenomenon found throughout nature. The Golden Ratio has been used to describe the number and pattern of leaves on a tree, diamonds on the skin of a pineapple, the ratio of your arm span to your height and the movements of the markets. During the Renaissance the master artists used the ratio, and the Fibonacci Sequence, to lay out their greatest works. The ratios inherent in the Golden Ratio are inherent in nature.

Fibonacci Retracements are most often used by traders to predict areas of support but they can also be used to predict potential targets for resistance as well. For those of you who don’t know what Fibonacci Retracements are here is a quick primer; the Golden Ratio is used to divide rallies and bear markets into “retracement” levels. There are 6 levels; 23.6%, 38.2%, 50%,61.8%, 78.6% and 100%. Each rally or decline is measured from the tip of the high to the tip of the low (for a bear market) or from the tip of the low to the tip of the high (in a bull market). The Fibonacci tool uses that measurement to project the retracement levels onto the chart. Once projected the levels can be used as targets for pull backs, corrections, snap backs and reversals.

Using Fibonacci To Trade Binary Options

So, how do you apply Fibonacci for trading binary options. Simple; use them as potential areas for signals to form. A Fibonacci in and of itself is not really a signal, it is merely an estimation of where the market is likely to do something such as form a signal. What that something is will not be know until the market does it.

  • Fibonacci Rule For Binary Options Traders – A Fibonacci Retracement Level is not a signal, it is a level where a signal is likely to occur.

Let’s look at the chart below. A major decline in gold stocks occurred at the same time as a decline in gold prices began. Barrick Gold was not immune to the sell off. There was a high in September 2020, this is where I will start my retracements. The stock’s most recent bottom is in early July so that is the point to which I measure for the retracements. The first thing that I notice is that the 23.6% retracement of the bear market emerged as a potential support/resistance line even before the decline hit bottom in July. Second, in the four months since the stock hit bottom it has tested that same resistance level four times and failed. That is four potential trades for savvy binary options traders using the daily charts and a sign of future bearishness.

Now, looking at the same chart of daily prices, we can make some other analysis as well. Each level of the retracements can have different meaning. On this chart the 23.6% level is important because it can reinforce the underlying trend. If the trend is down and prices retreat to the 23.6% retracement and are repelled then the underlying down trend is likely to continue. On this chart, since prices are not able to break said level we can assume they won’t at this time and that prices will at least retest the most recent bottom.

We can see this technique using the same chart with different retracement levels. If we redraw the Fibonacci retracements using the bottom that formed in late March it becomes somewhat obvious. Prices hit the bottom, bounced higher and were not even to make it as high as the 23.6% retracement before bearish topping signals emerged around the 30 day moving average. Prices then continue moving lower and then gap below the 0% line without even testing it.

  • Fibonacci Rule For Binary Options Trading – A signal that occurs at a retracement is stronger than one that doesn’t. But that doesn’t mean that a strong signal won’t occur between two lines.

Now, referring back to the retracement levels themselves, let’s talk about the importance of each line a little more. I touched base on how a bounce from the 23.6% line was potentially trend continuing, a break through that line is sign of a stronger reversal. Once prices break through a Fibonnacci line the next target is the next Fibonacci retracement level. Each retracement level that gets broken makes it more likely the next will be tested. A break below the 50% line makes full retracement of the original rally or decline highly probable.

Fibonacci Retracements For Short Term Trading

Looking at the chart below of 60 minute candlesticks I have applied a Fibonacci to a recent near term rally. The bounce from the bottom was very strong and provided several opportunities to trade short term binary options with expiries ranging from one hour to a few days or a week. Each time the asset price moved higher it moved above the retracement level with little to no resistance until hitting the top of the measured range. Notice how the asset provides an entry point at or just above each retracement level it is broken.

  • Fibonacci Rule for binary options traders – Once a Fibonacci Retracement level has been broken the next retracement becomes the target. The stronger the move above the previous retracement the more likely the move will continue in the same direction.
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