Strategies for a first-time Binary trader

Trading strategy

Are you trying to enter the world of trading with binary options? Good and thorough research goes a long way in investing money. However, the best way to trade and enter the game is by having binary options.

You can earn real money from binary trading if you learn various strategies and apply the best strategy according to the market conditions. You gradually profit from this investing method after practicing all the strategies discussed below.

Read this article to understand the best trading strategies in binary options and how you can use them to gain profits. So, let’s get started.

What is binary trading?

Traders gain profits from constant shifts or fluctuations in prices of the global markets with the help of binary options. There are certain risks involved, like the constant fluctuations in the market that could either be profitable or just a simple loss.

They are the most commonly used financial instruments to earn more money than you invested. A novice in trading can also deal with this tool, granted they know how to use the popular strategies along with the tools. Let us now discuss the popular strategies that you can use to trade in binary options.

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Some popular strategies for new binary traders:

Strategies that you can imply while trading is discussed below:

1. Market trends 

For any beginner, trading must always start with small steps, meaning, investing little money to see how the market works. Following trends is the safest practice for earning profits from trading in binary options.

This strategy works best to boost the trader’s confidence to take risks when he’s competent enough to understand the workings of the market.

Market trends

Asset prices are increased or decreased according to the trend’s movement. Therefore, study the pattern of such fluctuations and trade based on your collected information.

2. Current affairs 

Beginners have to be aware of the current market news affecting their investment. To make good profits, you should keep a lookout for the turn of events and then buy binary options in trading.

However, do not stick to one source of information like online news articles. Keep a check on the newspaper, radio stations, and even news channels on TV to assess the situation correctly. Also, understand the asset and determine the change in prices then. Refer to an economic calendar to get constant news of the market.

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3. Pinnochio strategy 

To understand the strategy, think about placing bets against the market trends. For example, when an asset’s prices rise, you should put an option on places where you expect the asset’s prices to fall in one token. When the market falls, it will rise again, increasing your money.

Here, you can start basing small bets but gradually increasing the bet on places where you expect the market to rise and the asset price will increase. However, this strategy can be risky for beginners as it may shake their confidence if the trade goes wrong.

Pinnochio strategy

4. Straddle strategy 

According to this strategy, you have to place your bets before there is an important announcement related to the trade.

The announcement can be positive, which could increase the asset’s value. But it could also lead to a decline in the prices. The decline would bring the prices down, and you must have an option to recover from the down market.

This is the most common type of strategy applied by traders since it is the only consistent strategy that will bring you profits. First, however, you have to know the market in and out for understanding the announcement and trade accordingly.

Straddle strategy
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5. Hedging strategy 

This strategy has a slow result but is still effective. Firstly, you have to place calls and then place the asset after the calls. This way, you will definitely make money even if the prices in the market increase or decrease.

Professional traders find this approach to be laid back since you must wait for the result. However, you also have to determine how much you could lose so that you don’t lose money even after the trade ends.

Hedging strategy

6. Fundamental analysis 

Fundamental analysis is not a strategy of trading but an analytic procedure that helps you achieve assets that would prove to be beneficial for you.

When you perform an analysis on a company, you analyze its assets as well as the company itself. This practice enables you to see what kind of trade would work. Usually, people would place a trade that has less risk of failing.

When you trade again, you are aware of the positives and negatives of the trade. However, you can only determine the tool through which you can get money after the trade expires. 

Fundamental analysis

7. Momentum strategy 

If you apply this strategy, you have to determine an indicator that will show the momentum of prices going up and down. This strategy is great as you get to know how much profit you can gain from the asset prices.

However, certain factors have to be taken into consideration, like relative analysis, process-related analysis, and the complete final analysis. The analyses will help find the pace of the asset prices in the market. In addition, you can easily get an estimate of the profit or gain you would gain.

Momentum strategy
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Conclusion: Trade binary options carefully

For a good trader, it is crucial to have a set plan that consists of money-spending strategies and the knowledge to withdraw it at the right time. Without being aware of all merits and demerits of trading money, you risk losing money.

Therefore, you must carefully apply the strategies to get the most out of the money you invested. Trading in binary options is already a great way of trading money, but one has to know the market well and how it functions to gain profits.

So, the most important advice for a beginner would be to understand the market trends, study the rise and fall of the market and apply one of these strategies to lead to road of profitability. 

About the author

Percival Knight
I am an experienced Binary Options trader for more than 10 years. Mainly, I trade 60 second-trades at a very high hit rate.

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