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  • What tools can be used for Binary Options Trading?

    Tools for Binary Options Trading

    Today, we will talk about those tools that a beginner trader must have in order to succeed in binary options trading.

    The difference between a binary options trader and a gambler is simple. The binary options trader does his analysis before he goes into the market. The gambler simply makes his move based on a hunch or bases his bet on luck. In trading, there is no room for luck and a trader must acquire the necessary tools in order to succeed in trading.

    Here are the tools every binary options trader must have.
    Charts

    Charts are the bedrock of technical analysis and there is no way a trader can make it in the binary options market without having charts with which to perform technical analysis. Charts tell us a whole lot about what a financial asset is doing. The key to succeeding in the binary options market is being able to make accurate predictions, and charts can go a long way with helping us make predictions.

    Where To Get Charting

    Charts are great predictors of market movement. Using a chart patter, you can tell if the price of an asset is headed up or down (which can be used to trade a High/Low trade or Up/Down trade). You can also tell if an asset will move sideways in a consolidation, which can then be used to play the Boundary (In/Out) trade.




    In the chart example above, the market stayed in consolidation for about four days before making a southwards move. This chart could be used to make an “IN” trade in the In/Out variety, restricting the expiry to 3 days.







    Likewise, this descending triangle chart could be used to trade a “Low” or “Down in a High/Low or Up/Down trade. It could also be used to trade a “Touch” trade, selecting a price barrier between the S1 and S2 support lines, or could be used to trade a “No Touch”, using a price barrier between the Daily Pivot and R1. There are so many possibilities.

    Without charts, forget about making money in binary options. It will not happen.
    Signals

    Signals are trades analyzed either from real people or automatically generated tools or strategies. Indicators are tools which help you analyze data yourself. Signals can be useful for beginners, click here for reviews of some binary option signal providers.
    Technical Indicators

    When you combine technical indicators with charts, then you have increased the probability of making winning trades, and doing that consistently.

    The chart below is an example of how I use a strategy based on the MACD technical indicator, as well as the moving average trend indicator to determine what the price action of an asset will be. Once more, this can be used to trade all manner of possibilities. This particular strategy correctly showed that the price action of the AUDUSD would breakout in an upward direction following the cross of the moving averages as well as the MACD crossover from negative to positive. I could place the following trades in the market using this strategy:

    1) A “High” option in a High/Low trade

    2) A “Touch” option using a price barrier between 1.0200 and 1.0300.

    3) A “No Touch” option using a strike price below the stop loss of 0.9700.

    4) An “Out” trade setting a range between the stop loss and the resistance level of 1.0170.







    If you get the analysis right, you will score winners on all the option types and instead of an 85% payout, you quadruple your earnings!


    A word of caution: you get this wrong, and your losses will quadruple as well.


    However, with charts and technical indicators, you will win and not lose.


    Knowledge of Technical Analysis


    Knowing how to combine charts and technical indicators to predict price action is known as technical analysis. It is not enough to have these tools. You need to know how to use them. In subsequent lessons, we will show you how.

  • #2
    Charts are really important with binary trading options as well as the use of signals. You can use both of them hand in hand when trading binary options so you can have a desirable results in trading your investment.

    Comment


    • Dragon Trader
      Dragon Trader commented
      Editing a comment
      Kuna G. you got it right, charts and signals always get along together and never forget the data you can find through different financial sites.

  • #3
    Knowledge of Technical Analysis and Charts when put together will be a reliable tool for your binary options trading.

    Comment


    • #4
      When it comes to binary options most traders will be using MACD or moving average indicators, but not many seem to use Fibbonacci as a tool; or more correctly, the Fibbonacci retracement tool. Retracements happen all the time in trading. Essentially, they are a temporary reversal of a stock prices direction. They do not follow the trend overall of the price and they do not necessarily mean an overall change of direction. What they are is small dips that are often there as indications of market resistance to an upward trend. This can similarly be reversed for downward trends. Retracements occur all the time. As a trader, you’ll have to learn how these can be advantageous to you.

      Comment


      • Flash Django
        Flash Django commented
        Editing a comment
        stockmarket what is MACD? is it an acronym or how are you going to use this tool?

    • #5
      Signals, financial charts you get from free thru financial websites, study some tools like Fibonacci will greatly help you with your binary option trading. Actually you don't have to spend too much to get the right signals but if you really are too dead serious in ending up with the right trade, you can purchase some trusted financial signals online.

      Comment


      • #6
        Originally posted by stockmarket View Post
        When it comes to binary options most traders will be using MACD or moving average indicators, but not many seem to use Fibbonacci as a tool; or more correctly, the Fibbonacci retracement tool. Retracements happen all the time in trading. Essentially, they are a temporary reversal of a stock prices direction. They do not follow the trend overall of the price and they do not necessarily mean an overall change of direction. What they are is small dips that are often there as indications of market resistance to an upward trend. This can similarly be reversed for downward trends. Retracements occur all the time. As a trader, you’ll have to learn how these can be advantageous to you.
        so how can a MACD be an advantage stockmarket?

        Comment


        • #7
          financial charts work for me. it's easier to see if there's any trend

          Comment

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