Binary options trading is subject to changes as it is directly impacted by the ever changing market trends of various tradeable assets. With such levels of volatility and implicated risks, strategic moves aren’t the least recommended. Strategies differ and their efficiency levels differ too. Here are some advanced binary options trading strategies useful for optimal successful trading.
It’s very basic. Binary options trading involves only the right prediction of the eventual market value of an asset. That’s all. Then what demarcates an advanced trader from a beginner? Well, it’s the nature of the prediction and the methods used to conclude a prediction. One can make any random speculation, but success in options trading can be maximised through strategic predictions. What does that really mean? Advanced traders know it well. Any prediction can go wrong in wake of events (most often unexpected) happening internationally. What advanced traders really do is use every possible medium to make sure that they are taking the right decisions.Resources of all levels are used to reach the right decision but experienced traders makes use of the most accurate ones.. Here are some of them.
Technicals coupled with Fundamentals
Technical analysis involves the analytical understanding of the trend of specific assets based upon their past performances. That is, past performances of assets depicted on charts, are basically taken as the very metrics to predict their future movements. There exist many charts that traders use to meet such ends. One among the most popular and most used ones, is the Japanese candlestick chart. As the name suggests, the chart depicts the market value movement of assets through the use of candle sticks. Generally white or green colored candles represent a bullish trend and black or red colored ones represent a bearish trend. One candle may represent an asset’s trend over an hour, a day, a year and also over short time lapse as long as one minute.
Various factors are to be observed on a chart before making forecasts. Amongst, are the support and resistance levels. A support level is the price level, below which, an asset is deemed not to fall. When the support level is hit, the market value of an asset is expected to rebound while when a resistance line is hit, trends are expected to go downhill. A resistance line indicates a point where an asset finds it difficult to break through higher. Relying solely on these charts won’t be sufficient though.
Yes! It isn’t.To optimise success in trades, these technical analytics have to be coupled with fundamentals. The reason is clear- either confirm the indicated outcome or avoid failure due to unexpected events. Indeed, when a chart indicates a probable trend for any asset, one should not blindly bank on that indication. It is highly recommended for binary traders to refer to fundamentals first. For instance, decisive international news and events normally help in ascertaining whether a prediction will indeed go right or not. News of events as natural calamities could also point towards a reversal in trends, especially for commodities. As a matter of fact advanced traders are all the time well informed and updated. One just cannot ignore the importance of being informed.
Indicators- The Ichimoku cloud
Deriving accurate predictions from charts isn’t that easy. Without proper understanding and education it is challenging to successfully craft your trading skills.. What most of the time help traders predict mostly accurate trends on charts, are indicators. There exist a large variety of indicators which use different metrics to deliver predictions. The Ichimoku cloud is much coveted as an indicator as it is deemed rather precise and accurate. The ichimoku cloud isn’t very hard to be grasped. The cloud basically depicts support, resistance and momentum while providing the directions of an asset’s market value taken by using moving averages.
The ichimoku indicator depicts movements through lines, notably the Tenkan Sen, the Kijun Sen, the Senkou Span A and the Senkou Span B. The area lying between the Senkou Span A and the Senkou Span B is what is basically referred to as the ‘cloud’.
Reading through the clouds
While reading a chart using the ichimoku cloud, the very basic thing one has to do is to spot how the cloud is evolving as this is what would serve as hint for future market trends of assets. When the Ichimoku cloud trends above the candles on a chart, it hints towards the asset being in a bearish stance and if the cloud continues to trend on that level, it would imply that the asset would continue remain at the lows. In another scenario when an asset is bullish or trends strongly, the Ichimoku cloud normally remains below the candles and if it continues in that direction, it implies that the asset will remain bullish. In case the candles are found within the cloud, an asset is basically trading within a specific range.
It also happens that the Senkou Span A and the Senkou Span B intersect at some point. The occurrence of such an event always indicates a probable change in the trends of the asset. At such points, what traders do is to immediately check for fundamentals as international news and schedules of important releases and meetings so as to confirm the change. These news and releases are normally the factors triggering the changes. Again ,this is important as experts need to make sure that these indications are going to materialise or not.
The Moving Average Convergence Divergence (MACD) Indicator
Yet another indicator, MADC is basically a trend-following momentum indicator which depicts the relationship between two moving averages of prices. This indicator is much popular for its ability to help quickly spot short-term momentum. In fact, the MADC was designed to profit from a situation whereby a short-term moving average and a long-term moving average diverge away from each other. What happens actually is that the value for the long-term moving average is subtracted from the short-term moving average and the result is plotted onto a chart.
While analysing, one can receive either a positive MADC Value created when the short-term average is above the longer-term average, is used to signal increasing upward momentum or a falling negative MACD value which suggests that the downtrend is getting stronger, and that it may not be the best time to buy.
Know the rules
Being expert definitely implies that one has mastered the specific field of expertise. That in turn implies that an expert if fully versed in all the aspects of the field one is expert in. In binary options also, it is required that one be fully conversant with every traits of the industry and especially the broker one is dealing with. Traders should adopt a principle of thoroughly knowing all the sets of rules and conditions a broker applies to its customers with regards to deposits, withdrawals and so forth. You might ask where the strategy lies in so doing? Well, advanced traders do not lose money foolishly. It would be rather foolish to get your money drained by being non-compliant to specific terms and conditions. It is well known that binary options brokers impose strict rules as far as withdrawal and other delicate procedures are concerned. Many novices end up losing money as a result of non-adherence to these rules. An expert isn’t going to let things as such happen.
While referring to rules, we are not only making allusion to terms and conditions. There exist also rules for investing. Indeed, experts have their own strategy to invest effectively and safely. Long term profit making is what most advanced traders seek. Traders should trade only the amount they can afford to lose. Profits need not be huge and once for all. Profits should rather be consistent and ever growing. The more one makes profits the bigger his trading account gets and so does his ability to invest higher amounts, thus turning into larger profits. The thing to retain here is that one should not be greedy and should be patient and that is what demarcates veterans from newbies.
Many strategies are there to help traders minimise risks while they are trading. These are indeed very important. Nevertheless, there is an undeniable fact. Risk is sure to be there even upon the use of advanced binary options trading strategies as the volatility over markets get accentuated for various reasons. Most of the time, unpredictable global events such as terrorist attacks take the markets by the horns and alter trends abruptly. In such instances, losses can be unavoidable. Indeed, the business is a risky one, but with a couple of good strategies, risks can be minimised and success can be optimised.