How to Trade Crypto on Binomo? | Complete Guide

In this comprehensive guide, we will discuss the step-by-step process of trading crypto on Binomo, enumerate all the available crypto assets you can trade, and examine how much you can potentially make by trading crypto using Binomo. Moreover, we will also cover the pros and cons, the key risks you need to be aware of, and the notable trading strategies you can explore.

Trade Crypto on Binomo: A Step-by-Step Tutorial

The following are the five simple steps you can follow to start trading crypto on Binomo:

Step 1: Choose the crypto asset you want to trade

After registering for a Binomo account (live or demo), you will be redirected to its trading platform. On the “Assets” list, you can select the crypto you prefer to trade. For this illustration, let’s choose “Crypto IDX.” 

Step 2: Make a price direction forecast

After selecting Crypto IDX, the next step is forecasting its likely price direction. In this step, you may utilize technical analysis tools available on the platform (found at the bottom left portion of the chart) to help with your analysis.

Clicking on the “Trading Tools” icon will present you with the following technical indicators:

Here, you can select whether to engage in Social Trading or use one or more of the 10 available indicators: Relative Strength Index (RSI), Fractals, Parabolic Stop and Reverse (SAR), Moving Averages, Moving Average Convergence Divergence (MACD), Bollinger Bands, Fractal Chaos Bands, Alligator, Average True Range (ATR), and Stochastic.

Furthermore, you can also choose the “Drawing Tools” icon to help you draw trendlines, identify structural support and resistances and other key price levels to watch out for.

Ultimately, these available trading and drawing tools will help you make a more informed price direction forecast.

Step 3:  Choose your preferred expiry time

The next step is determining your preferred expiry time between 1 minute (60 seconds) and 1 hour. This can be based entirely on your personal preference (some traders exclusively trade using a specific timeframe) or on your technical analysis hypothesis (e.g., a technical indicator may be pointing to an upcoming reversal at a given timeframe).

Step 4: Set your investment/trade amount

The next step is to put your investment amount (the amount you will risk for this particular trade). Note that Binomo’s minimum trade amount is $1. The key here is to only risk an amount you are comfortable losing per trade. Remember that you will lose this entire amount if you are incorrect with your analysis. Hence, you need to set your own risk management parameters.

One rule of thumb you can follow as a beginner is not to risk more than 2% of your total portfolio. This means that if you have a $100 total deposit in Binomo, you should only put in a maximum of $2 per trade. This ensures that you will not face the risk of “total ruin,” where you lose 90% in a short amount of time because you did not plan ahead. 

Moreover, having a consistent amount you will risk per trade prevents your emotions from taking over (e.g., in cases where you’re “sure” a trade will go your way, so you put a substantial portion of your portfolio in a single trade). Worse, in cases where you lose a significant amount, you may start to engage in “revenge trading,” which is an emotional drive to get your losses back.

Step 5: Execute the trade and journal your result

Finally, when everything is set, you just have to click the UP button if you forecast the crypto’s price will go up at your given timeframe or the DOWN button if you forecast that it will go down instead. 

As shown, you can make 83% when you are correct (on the right side of the chart), but you will lose 100% when you are incorrect. Hence, after the trade concludes, record your trade result and see what adjustments or improvements you can implement in your future crypto trades to improve your win/loss ratio.

Should you invest in rising or falling crypto prices?

It depends. Crypto trading in Binomo runs from 1 minute (60 seconds) to 1 hour. This short-term nature means that current market sentiment highly influences the price movement of available crypto in Binomo. Therefore, your decision must be based on sound technical analysis practice and not just your “hunch” or “gut feel” to determine which direction it will likely go within a certain timeframe. 

Available Cryptocurrency Assets on Binomo

Currently, two crypto assets are available for trading on Binomo’s platform. These are:

Crypto IDX (the most popular)

Payout Ratio: 83% for Standard and Gold users and 85% for VIP and Prestige status users

Binomo’s internal synthetic asset which represents the average value derived from the rates of four major cryptocurrencies: Bitcoin, Ethereum, Litecoin, and Bitcoin Cash.

Altcoin IDX

Payout Ratio: 40% for Standard and Gold users and 42% for VIP and Prestige status users

Composed of the average price movements of several leading altcoins (cryptocurrencies other than Bitcoin).

How Much Can I Earn Trading Crypto on Binomo? 

How much you can hypothetically earn depends on several factors, including your capital, your trading strategy’s win rate, and the amount you risk per trade. Let’s take a look at some scenarios of trading Crypto IDX to demonstrate this:

Example: With a Trading Capital of $100

Following our recommendation of only risking a maximum of 2% of your total trading capital per trade. We have the following:

• Total Trading Capital: $100
• Risked Capital Per Trade (2%): $2
• Crypto IDX Payout Ratio: 83% 
• Scenario 1: Profit (Your Forecast is Correct)
• Total Profit: $2 x 83% = $1.66 
• Capital After Win: $101.66

As shown, if you are a standard or gold status user, you can earn 83% of your risked capital per trade. In this case, you stand to gain $1.66 for risking $2 of your capital.

Scenario 2: Loss (Your Forecast is Incorrect)

• Total Loss: $2 x 100% = $2.00
• Capital After Loss: $98.00

However, you may note that the risk-reward ratio is skewed (risk = 100%; reward = 83%), and you risk 2 dollars for every 1.66 dollars you can potentially make. 

Thus, here’s the breakdown of calculating the breakeven or the minimum win rate you need to NOT lose money long-term:

• Breakeven: Loss Ratio / (Payout Ratio + Loss Ratio)
• Breakeven: 100% / (83% + 100%)
• Breakeven: 54.64% win rate

Hence, your strategy needs a win rate higher than the breakeven point of 54.64% to profit consistently. If your win rate is lower than this, you will not be profitable long-term.

Pros and Cons of Crypto Trading on Binomo

Risks of Crypto Trading

• Financial Risk: Trading crypto on Binomo presents a risk of total loss, especially if you do not adopt a proper risk management system such as the “2% rule” we advocate.
• Platform Risk: Despite its overall reliability, many Binomo users have reported experiencing technical issues, glitches, and lags, which affected their trading results.
• Volatility Risk: Binomo’s two crypto offerings are volatile and can change direction before you have the time to react. This is particularly true for lower timeframes (e.g., 1 minute).
• Overtrading Risk: Due to Binomo’s simple trading nature, it may potentially encourage overtrading, especially for beginners who find the ease of trading addicting.
• Skewed Risk-Reward: At any given asset, Binomo has a higher risk-to-reward ratio. For Crypto IDX, this is set to 83% reward versus 100% risk.

Strategies to Trade Crypto on Binomo

The following are some Binomo trading strategies you can use to trade crypto:

Swing Trading

In swing trading, you use technical analysis to identify potential “pivot points” in your selected crypto. Since trading in Binomo is incredibly short-term, you can look for potential “pullback areas” within an established trend. Likewise, you can search for signs of reversal, signaling a shift in market sentiment.

For example, if you see an established uptrend in the five-minute timeframe. You may use the moving average or simply draw a line connecting the higher lows (serving as the trend’s dynamic support). If the price bounce back from this point, then you can “go long” as it will likely continue trending higher. However, if it breaks the trend’s support, then you may “go short,” as it might be a sign of trend reversal.

Scalping

Scalping is one of the fastest trading strategies. Essentially, it involves taking advantage of short-term and small price changes done over multiple times in a day. For example, you can do multiple timeframe analyses and compare Binomo’ 5-second chart with the 5-minute chart, if the 5-second price goes near the the 5-minute structural resistance. Then, you may go short, as it will likely bounce back down. This is because support and resistance levels on longer timeframes serve as massive blocks on shorter timeframes. 

Indicator Divergence

For this, you can use the MACD, RSI, or STS. After setting one or more of these indicators on your screen, you wait for the “divergence.” This means that the indicator points in a different direction than where the price is going. For example, if the price has been going up, these indicators generally go up with the price as well. However, if you notice that the price is going up but MACD, for example, starts to point downwards, then this is a divergence. Hence, you can use this as a signal that the price is about to reverse.

Can you deposit and withdraw crypto on Binomo?

Yes, you can deposit and withdraw crypto from the following crypto wallets and cryptocurrencies: Binance Pay, Tether (USDT), Bitcoin (BTC), Ethereum (ETH), Litecoin (LTC), USD Coin (USDC), and other cryptocurrencies. For a complete step-by-step guide on how to do these, you may visit Binomo Deposit and Withdraw Funds using Crypto.

Conclusion

As we have shown, trading crypto on Binomo is relatively simple. Furthermore, Binomo offers a compelling value proposition for trading synthetic crypto assets versus traditional crypto assets. Nevertheless, it’s crucial to note its inherent disadvantages, such as a skewed risk-to-reward and the limited crypto offering it currently has to decide whether this trading medium is for you.

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