You can always win on binary options by using a well-structured trading strategy, a plan, and technical analysis tools. Using a trustworthy and credible binary options trader or broker is also essential to avoid fraud and improve your chance of winning big money. Don’t forget that winning in binary options requires patience, time, and dedication.
A binary option is a quick and easy financial tool that allows investors to wager on whether the price of an asset, such as Apple stock, USDT, the EUR/GBP exchange rate, or silver, will rise or fall in the future. The time duration might be as short as 60 seconds, allowing for hundreds of trades every day across any worldwide market.
Before you conduct a trade, you know precisely how much you stand to win if your forecast is accurate, which is generally between 70% and 97%. That means if you deposit $100, you will receive a credit between $170 and $195 and your prediction is correct. This simplifies risk management and trading choices significantly. You will also know how much money you stand to lose on a single deal.
The conclusion is always a Yes or No answer – you either win it all or you lose it all, hence the term “binary.” One of the appealing aspects is that the risk and return are recognized in advance. Binaries that are exchange traded are now accessible, which means that traders are not trading against the broker.
Below we have put together a simple, step by step procedure on how to trade binary options:
- Select your preferred broker – The first step is to choose a trusted, reputable, and licensed broker. You should use broker comparison and review platforms to narrow down your search for the best of the best brokers.
- Choose the binary market or asset to trade – The asset classes, types, and categories that encompass binary options trade are vast. They cover everything, including commodity, stock, Forex, oil, crypto, and indices.
- Pick the expiration – The next step is to select the expiration time. It can be as short as 30 seconds to as long as weeks.
- Set the trade size – You should be careful when setting the size of the trade because your full investment is on the line.
- Make your binary trade option – You can choose buy/sell or call/put
- Confirm and check the binary trade – Most binary option brokers allow you to take a last glimpse of the trade to ensure everything is up to scratch before confirming it.
The short answer is no; forex trading markets cannot entirely ever crash. However, individual currencies, especially those that are not well-known and traded, can crash at any time.
For instance, the Zimbabwean dollar crashed when the country’s economy collapsed following the ethnically fueled ejections and political instability.
Other examples of forex currencies that have crashed include:
- Dollar (Zimbabwe) – The Zimbabwean dollar crashed in 2006-2008 due to various factors. These include military coups, price controls, excessive money printing, and political instability.
- Escudo (Chile) – The Chilean Escudo crashed in 1985 and was replaced by the peso.
- Papiermark (Germany) – The Papiermark crashed after World War I due to hyperinflation resulting from colossal war debt and salary bills.
- Peso (Argentina) – The Argentinian Peso crashed following the collapse of the country’s economy in the middle of the 1970s after countries like the US and UK imposed the OPEC oil embargo.
- Sol (Peru) – the Peruvian Sol crashed in the early 1990s because of hyperinflation, rising public spending, and the flight of foreign investors.
Whereas specific currencies can collapse, the forex market cannot crash in its entirety. In fact, forex crashes are very different from crashes of stock exchanges. When a specific currency crashes, it can affect your position on a forex exchange market if you bought it.
Multiple currencies can also crash at the same time on a specific market. A flash crash describes this scenario whereby many currencies collapse on a forex exchange market. In 2019, the Japanese Yen crashed, causing a domino effect that led to the crashing of other currencies like the US Dollar, Euro, and Great Britain Sterling Pound.
Yes, you can win with binary options. Trading binary has two distinct outcomes – you can either win or lose a fixed amount, although the broker and the binary options exchange may deduct a small fee, charge, or commission from your payout.
Of course, winning with binary options requires using a reliable trading strategy and helpful trading tools like technical analysis software.
It is also vital for binary options traders to study the market, do risk assessments, and exercise patience before starting to win with their trades. Choosing the right broker and trading platform is a significant factor when you want to be successful with binary options. An excellent binary options broker is experienced, knowledgeable, and has a track record of high returns.
The best and most effective way to master binary trading is to start small and practice often using demo systems. It is also crucial to create a trading strategy and perfect it over time. All in all, mastering binary trading needs you to be fully committed, dedicated, and patient. Don’t fall for tips and tricks that promise overnight success, as winning with binary takes time and due diligence.
Here are top tips and pieces of advice you can use to succeed with binary options:
– Pick the right binary market
Many asset types are available for binary options trading. Most traders prefer major indices like NIKEI, NASDAQ 100, FTSE 100, DOW 30, S&P 500, or China 50; and foreign money trading binary options, such as EUR/USD, GBP/USD, USD/JPY, EUR/JPY, AUD/USD, USD/CAD, GBP/JPY, USD/CHF, EUR/GBP, AUD/JPY, and US/MXN.
You can also place binary trades on commodity prices of crude oil, gold, natural gas, and metals like silver. Most binary exchanges offer prediction options like up/down, touch/no-touch, etc. The most important thing is to choose an asset type or option that you are most comfortable trading. If you are knowledgeable in precious metals, try binary trading on them.
– Choose the perfect time to trade binary options
If you want to succeed with binary options, you would want to trade at peak activity times. Market research has shown that the best time to trade binary options for success is the hour between 9:30 am, and 10:30 am. That is when most exchanges receive the largest volumes of binary options trades, and thus the prices experience the biggest changes during this period.
– Use reputable binary brokers
The world of binary options trading is full of scams and fraud. And it can be challenging to know which binary options broker or brokerage firm is legitimate and trustworthy. We recommend you work with brokers with a clean track record of delivering returns to their clients. If anything, avoid brokers based overseas or abroad, as they are hard to track and make accountable.
Ideally, it would be best to work with licensed and registered binary options brokers regulated by a trusted financial regulatory body in your country or jurisdiction.
Some of the top-rated and reputable binary option brokers that serve Europe and US markets include IQcent, Raceoption, and VideForex.
For instance, if you are in the United States, you should only work with a broker licensed by the Commodity Futures Trading Commission (CFTC) or the Securities and Exchange Commission (SEC). If anything goes wrong, these agencies will help you resolve disputes and recover your money in case of fraud.
– Understand binary candlesticks and technical analysis
No one can predict how assets like stock indices, forex currencies, and commodity prices will move on exchange markets. Therefore, you need to know your candlesticks and perform technical analysis to succeed with binary options trading. There are numerous tools, online platforms, and pieces of software that can help you with technical analysis so that you can edge your binary trades.
– Practice is your best tool
The number one rule for succeeding with binary options is practice, practice, and then practice some more. Thankfully, most binary options exchanges, trading sites, and brokers offer demo accounts where you can practice with fake trades and virtual money.
The more you practice, the more experienced you will become, boosting your odds of success with trading via binary options.
– Embrace excellent money management skills
Money management is the key to succeeding with binary options trading. You don’t want to put all your money into one binary trade. Instead, it would be best to diversify your trades, making sure no single trade takes more than 30% of your bankroll balance.
You should set a budget before you start trading binary options. More crucially, you must ensure you do not go beyond your budget. Remember, trading via binary options is more like online gambling than an investment. Set win and loss limits – stop trading once you have reached these limits.
– You should not try to chase your binary losses
Discipline is an important factor if you want to succeed with binary options. As with online gambling, binary options are high-risk, high-yield trading vehicles. You can make a lot of money in a short period. And you can lose equally a lot of money in a short time.
Aside from setting a budget and win/loss limits, it is important never to try to make up your binary trading losses. You will make more losses and dig yourself into more financial trouble. Like in betting, you should know when to quit with binary options.
– Develop and use a solid trading strategy
Unlike casino gambling which is often down to luck, trading via binary options is not all pure chance. For this reason, you need to develop a trading plan and strategy. This strategy will help you execute your binary trades step by step. It will tell you which asset classes to trade, when to trade, and how long. For instance, short-term binary trading strategies are usually good for forex traders, while no-loss strategy can work across the board.
– Start small and be realistic
Trading via binary options is not going to make you an overnight millionaire. In fact, you might never become a millionaire trading binary options. Therefore, you must start small when you are still inexperienced and likely to make costly mistakes. Be realistic with your expectations, as well.
– Don’t overdo it
The quick-fire nature of binary trading can bring out addiction in some people. It would be best if you were not so obsessed with binary options that you start overtrading. Trading via binary options requires patience, self-control, and discipline. This is especially crucial when it comes to short-term trades.
Instead of trading for hours on end, you should spend around 1-hour trading binary options, then take a break of 15 or more minutes before resuming. You should also limit the size of your trades and the time spent trading each day.
When all’s said and done, succeeding with binary options means that you should assess the risk and reward before you start trading. Practice often, exercise self-control and work with regulated brokers.
As you can tell from the name, 5-minute binary options are binary trades whose contracts expire five minutes after you take a position on the market. For instance, if you bet on the USD to go up against Euro, the binary trade will be paid out according to the outcome after five minutes have elapsed.
It is easier to win 5-minute binary options if the asset prices move quickly. This is usually the case with volatile stock indices like NYSE or Nasdaq and forex currencies like USD that vary significantly in exchange value in the course of the hour and day.
As with all binary trades, 5-minute contracts are settled at $0 or $100, depending on whether the value of the underlying asset has gone down or up.
The rule of thumb is to study the market carefully and note times when the underlying assets are most likely to appreciate or depreciate. Using technical analysis tools and a trading strategy can also help you win with 5-minute binary options.
You can win binary trading by…
- Developing a robust trading strategy
- Managing your money wisely.
- Choosing the most ideal legitimate binary options trading broker
- Understanding the market dynamics, underlying asset types, and getting knowledgeable about binary options
- Focusing on the long-term benefits of binary trading
- Assessing risk and rewards before trading
- Avoiding the use of emotions and using a clear head to make binary trades
- Keeping up to date with market news, tips, and other developments
- Not chasing your binary losses
- Practicing often using demo accounts
Most binary option traders go for the standard 14-day time frame. Thankfully, you can choose a time frame that works best for your trading style, budget, and underlying asset. If you are novice trader, you might want to hold off shorter time frames like 30 seconds or minutes.
When looking for good trades, look at the levels of activity. Levels below 20% show that the options are oversold, while levels beyond 80% indicate that they have been overbought.
As far as timing goes, you should avoid trading binary options during low-activity periods, which typically falls between 11 PM and 10 AM SAST. Instead, you should focus your binary trades on the period between 2 PM and 11 PM SAST.
It really depends. Some brokers and traders claim that Forex trading deliver better returns in the long term than day trading. They usually argue that investing Forex will yield bigger profits in the long haul than day trading. But, ROI and yield do vary from one trader to the next, so this cannot be taken as general rule.