How to develop your own binary options trading system

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Binary Options Trading Strategy – Best 60-Seconds Strategies

Today we are going to share our binary options trading strategy with you. This strategy is designed to help you identify whether you’ll like trading binaries and teach you how to trade binary options the right way. If you prefer to play it safe over gambling, you’ll need a strategy or tactic to help you master binary options and other trading activities. This is where our TSG team comes to the rescue. We will provide you with the best binary options strategy.

The main reason we’re interested in learning about trade binary options is the fact that binaries simplify what we’re already doing in Forex. At the same time, binary options also allow us to make more money in the process. We are also controlling the risk.

Binary options are easy to understand. This is coming from someone who has little or no experience in the area. If your favorite approach to trading forex is to jump in on a fast price movement and ride the intraday trend for as long as the momentum lasts, you can learn how to make money trading binary options very quickly.

When we first discovered binaries, the light bulb in our heads turned on. We figured out the same thing that we’ve been doing in Forex can be done. But walk away with 75%, even 95% winning trades because we only needed to get the direction right. No need to worry about how many pips we could grasp in the process.

And that, my friends, is the real beauty of binary options.

What are Binary Options?

Binary options are a form of derivatives that have a fixed profit or loss. Trading binary options is simple. All you need to do is ask yourself a simple yes or no question. Will the price of the underlying asset be worth more than the strike price at the expiration date?

Now, let’s start by understanding how binary options work.

Essentially, we can trade binary options for any type of instrument. Whether it be commodities (Gold, Oil or Silver), Forex exchange currencies (EUR/USD, GBP/USD or USD/JPY), or stocks (Amazon, Tesla or Twitter).

So, the first thing you need to decide upon is to select the asset to trade.

Second, before submitting our trades, each of these instruments has a current value at any given point in time. How to trade binary options depends on our trading skills. It is used to predict where the current value will be some time in the future. In other words, we must use our skills to predict the market direction. This will determine our success in trading binary options.

The market can only go up or down. If we believe the current value will go up in the near future, then we buy a Call option. On the other hand, if we believe the current value will go down in the near future, we buy a Put option. Read more about call options vs put options.

Third, we need to determine what the most critical aspect of trading binary options is. The expiration time will ultimately determine if you’re making a profit or not.

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Trading binary options require you to correctly forecast two things:

  1. Whether the market will rise or fall.
  2. Your forecast needs to be accurate during a certain time frame – called the expiration time.

If you’re right on the market direction by the time of the expiration time, you earn a profit. Being wrong means you incur a loss. The way binary options works is that if you’re right on the market direction, you’ll get a percentage of what you initially invested in.

Typically between 75% and 95% and in some cases, even 100% of your initial investment, depending on your Binary Options Broker.

Supposing we’re wrong on the trade, then we’re going to lose the whole amount invested in the short term.

We have made a nice infographic that highlights the four steps on how to master binary options trading.

Now we’re going to focus on step two, which is how to predict the price movement. If you manage to figure this out, then knowing how to make money trading binary options will be a piece of cake for you.

Now, before we’ll outline a method on how to make money trading binary options, we always recommend taking a piece of paper and a pen and take notes on the rules of the best binary options strategy.

In this demonstration, we’re going to look at the buying Calls.

The Best Binary Options Strategy

Our team at Trading Strategy Guides is ready to share with our beloved trading community our 60-second binary options strategy. We don’t just hope this strategy will make you money, we’re certain it will. The mathematical model behind this binary options trading strategy has a proven market edge.

The only tool you need to trade binary options successfully is the RSI indicator.

Even the RSI indicator is not good enough if it doesn’t have the “right” settings. The RSI default settings need a little bit of adjustment if you want to master the 1 minute time frame. We use a 3-period RSI to trade binary options profitably.

Naturally, a lower RSI period means that the indicator will tend to be noisier than normal. But it is more responsive to the immediate price action. Along with the RSI settings adjustments, we also played around with the overbought and oversold readings. We found out that by using an 80 RSI reading for overbought and 20 RSI reading for oversold condition, we get more accurate day trading signals.

*Note: Make sure you adjust the RSI settings before you jump into the binary options trading strategy.

By changing the RSI overbought and oversold line, we have eliminated the noise. So now we’re ready to highlight our binary options step-by-step guide:

Step #1: Find an instrument that is showing a low the last 50 candlesticks. Use the 60-second chart (1 Minute TF)

The 1-minute binary options or the 60-seconds time frame is the best chart for trading binary options. In other words, the best binary options expiration time is the 60 seconds time frame.

We recommend highlighting the starting point on your charts. And the ending point of your 50-candle low that you have identified. Simply draw two vertical lines on your chart through the starting point and ending point of your 50 candle low.

When you count the 50 candle low, you should always start from the current candle. Then go from the right side of your chart to the left side of your chart. If you manage to count 50 candle low, obviously the starting candle point will be your 50 candle low.

Moving forward, it’s time to put the RSI indicator in use and spot if we have extreme oversold reading or not.

Step #2: At the moment the 50 candle low develops, we need an RSI reading of 20 or below

Since this is a reversal trading strategy we need the RSI indicator to show a bullish reversal signal. An RSI reading below 20 shows that the market is in oversold territory and it can potentially reverse.

In our example below, the 1-minute EUR/USD chart is satisfying the two conditions.

Keep in mind that in order to move to the next step, we need the 50 candle low. We also need an RSI reading below 20 to happen at the same time.

We added one more factor of confluence that needs to be satisfied. If used in conjunction with the previous two conditions, it will make you a money maker binary options trader.

Step #3: Look for a bullish divergence to develop between the RSI indicator and the price.

When trading reversals, you need to be as precise as possible. The more confluence factors you have in your favor the more accurate the reversal signal is.

What we need to see here is for the price to continue moving lower after the 50 candle low was identified. At the same time, we need the RSI indicator to move higher in the opposite direction.

If the price moves in one direction and the momentum indicator moves in the opposite direction, it means they are diverging from each other. This signals a potential reversal signal.

Now it’s time to highlight how to find the right entry point for the binary options trading strategy.

Step #4: Buy a Call Option after the first candle that closes above the high of the 50 candle low

The first thing you need to do is to mark on your chart the high of the 50 candles low with a horizontal line. The first candlestick formation that breaks above this high is your trade entry signal to buy a 60-second Call option.

It’s that simple!

After you decide the amount to invest and pick the 60-seconds as your expiration time, it’s time to sit back and wait 1 minute before hopefully collecting your profits.

Step #5: You collect your profits if the next candle closes higher than your trigger candle

If at the expiration time, the price is higher than the price you opened your Call binary options, you’re lucky because you’re about to check-in a big payout.

For example, if you’ve invested $1,000 and your binary options broker offers you an 85% payout, it means that you accurately predicted the outcome of a trade. You get back your initial investment of $1,000 plus the 85% payout which in our case is $850 in profits.

If you want to buy Put binary options, use the same binary options guide, but in reverse.

Conclusion – Binary Options Trading Strategy

Before learning how to make money trading binary options you need a great Binary Options broker. You can’t start hitting home runs right out the gate without making sure you have a binary options broker who wants you to succeed. Secondly, you need a strategy based trading technique to reveal the market direction. You only need to forecast if the price will be up or down during the next 60 seconds, making it very convenient.

We use a heuristic approach to speculate on which way the price is going to move during the next 60 seconds. At the end of the day, traders are looking for a reliable binary options system that will help them make money from trading.

The good news is that the best binary options strategy is exactly that system. Our team is built of many traders with experience in the industry, including binary options traders who know how to make winning trades. We’re ready to help you with every step of the way.

Thank you for reading!

Also, please give this strategy a 5 star if you enjoyed it!

Don’t forget to read our guide on regular options trading for beginners here.

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How to Win Binary Options Every Time

How to win binary options every time? – The last five years have been the golden years for binary options. The market has grown phenomenally and traders are joining in the trade in multiples. The binary options have expanded and the systems have become more sophisticated and accurate, especially with the advent of automated systems. Profits have risen and a good number of traders have made impressive profits over this time. Within the same period, there have been traders who did not do very well in the binary options trading. This will happen if you do not develop a plan to profit from binary options consistently. Also selecting a proper broker like IQ Option or Option Robot will help you along the way!

Binary options trades, like any other trading transactions in the assets and commodities markets can go either way; make a profit or lose your investment. The trick is to keep the winnings considerably higher than losses over an extended period of time. Here you will learn what to do and what not to do to create a framework within which you can make winning trades consistently. What you need to do is:

Control your expectations

Probably the right word to use here is ‘greed’. In binary options, it is very easy to be overwhelmed by your emotions. Such things tend to happen when you are winning, or losing money. The definite thing you need to do is to keep a clear head; keep all your emotions at bay. You must have come across trading platforms in this business claiming of extraordinary successes of making millionaires in a few months after making a small deposit. You probably want to be that person. While there is nothing wrong with that, the bad news is that you probably won’t be that person. With that out of the way, focus on making small consistent wins as a start, and then expand from there. The chances of becoming a millionaire within three months of trading with a deposit of $500 is a million to one; do not make rash decisions to invest all or most of your investment on a single trade just because you just made are on an 85% roll. Keep a clear head.

How Binary Option Robot Can Change Your Life? Check This Out!

How to develop your own binary options trading scheme?

Binary options, despite the financial prospects for potential investors, require in the process of profit making the solution of many technical and analytical problems. To effectively use binary contracts, traders use strategies that, thanks to specialized approaches, methods and tools, are able to give certain statistical advantages to the market, and also provide an opportunity to more clearly generate effective trade forecasts for the formation of market positions.

Today the network is full of various systems and strategies that can certainly satisfy certain requirements of investors in the process of trading options. However, if we talk about professional trade and the achievement of financial heights, it should be said that the bulk of well-known investors and financial market professionals have achieved success due to their own high-quality trading systems. Schemes of work on the market, which the trader has developed independently, are the most universal and profitable tool.

Of course for most private non-professional online traders with minimal experience in trading and only basic knowledge in financial trading it is rather difficult to independently develop an effective and working strategy, but it is possible! Against this background, we offer a useful guide to developing a trading strategy for binary trading, which will help you understand the technical subtleties of the process of forming trading schemes.

So, before embarking on the formation of a strategy, it is necessary to clearly understand the principle of the main trading instrument – binary options. What task should we solve for profit? Everything is extremely simple – the main condition for the profitability of the contract is to determine the direction of the market fluctuations or the forecast about the value of the price at a certain point in time. Hence the logical conclusion is that to determine the necessary indicators we need a system that will effectively determine the most profitable market positions for betting an option. In this case, the most attractive moments are the levels of origin of new trend movements or a stable market trend. Simply put, the most optimal conditions for binary trading is the work on the trend of quotations. In this way, you can achieve the most effective statistics.
To determine the trends and points of their origin, as, indeed, for the calculation of other indicators, there are two directions of analysis in trade:

Fundamental, where as the indicators for forecasting the market are the fundamental statistics, political and economic news, as well as the activities of financial regulators and government bodies. On the basis of such drivers of influence on the market, the trader’s behavior pattern is built when working on the trading platform
Technical – here traders evaluate current market indicators using a wide range of specialized techniques and tools: from patterns and cyclic regularities to the generation of signals using indicators of automatic analysis

A professional trader must master all areas of analysis in order to create an effective trading system. In addition, in the preparatory stage of strategy development, the investor needs to first understand what type of system suits him the most. Here you need to take into account a lot of indicators – a comfortable rate of trade, the choice of working assets, the preferred mode of forecasting and a list of tools that the trader understands.

Most professionals seek to develop the most efficient and simple systems, which include Price Action strategies or indicator approaches to generating forecasts. These types of trading schemes are characterized by simpler algorithms for estimating market indicators, efficiency, high level of performance and correct evaluation of short-term trading periods. Having determined the type of trading strategy that suits you for all indicators, proceed to the direct development. To do this, you need to take the following steps:

• Outline the list of trading assets

Trading quotes of various financial instruments are subject to a diverse spectrum of patterns and drivers of influence. If you open asset schedules, then you will not find two of the same. Therefore, for effective trade, you need to create a set of the most attractive trading resources. The fact is that some assets work perfectly on strategies of fundamental analysis, for example, “Trading on the news” – this includes commodity assets, gold, stock market instruments (stocks), others show excellent results using graphical or indicator strategies – mostly currency pairs. Therefore, the choice of assets for trading is an important factor in building a trading system.

• Determine the optimal trading time

Effective time management is also the foundation for the formation of a profitable approach to trade. Firstly, here there are several time periods for trading – night, which is characterized by low volatility of the market, minimal dynamics of trading, limited list of assets. Day, which is characterized by the activity of the movement of quotations, strong impulse movements of the trend, the maximum dynamics of trade operations. In addition, there are several additional time periods for trading – weekend trading, which uses specialized assets for trading or artificial trading quotes generated by the algorithm of the brokerage platform, as well as the time of the release of the fundamental data. Having determined the optimal time period of work in the market, the investor can improve the level of performance of his trading. Let’s continue, the next step is the direct development of the system.

• How to build a strategy

So, you have decided on the assets for trading, set the trading time for yourself, now you need to create a system template. For this, it is necessary to analyze the quotation chart well and identify the most accurate and cyclical patterns. To informatively show the principle of system development, we take two simple and most popular types of strategies – indicator and Price Action.

Indicator systems – to create a template for market analysis using indicators, select from your list of understandable analysis services tools with different modes and algorithms. Ideally, if you use a set of oscillators, trend indicators and auxiliary services, for example, volume determination tools. Expansion of the estimated market indicators will allow you to build a system with high efficiency and versatility. Next, analyze the performance of indicators on the history of quotations. This is necessary to determine the system of signals that can form an instrumental set of strategies. Having identified the necessary indicator signal indicators that can be used in practical trading, fine-tune the analysis services. This is necessary for a correct estimation of quotations of a particular asset. It is through the combination of indicators and experiments with their technical settings that professional indicator-type strategies are born.

Strategies for Price Action – this format of systems is more complicated in development. To form a system of this type, you need to have a relatively large trading experience and attention. The bulk of Price Action systems are strategies based on cyclical patterns and the identification of certain market indicators that can be used as signals for trading. A simple example is working on trend levels. The developers of this system simply noticed the regularity of the market, in which the price, reaching certain indicators, carried out a trend reversal. So the trading strategy was born. Another example is candle models. The chart in the mode of Japanese candles generates a wide variety of shapes, combinations and figures of quotations of quotations that are able to inform the trader about changes in the movements of the market. Having identified this model, you can draw up a lucrative rate. Thus, the development of the Price Action strategy is to monitor the market for the identification of certain cyclical patterns. It should be noted that such indicators are considered by professionals to be the most effective signals for trading.

Calculation of expiration for trading by strategy

The second most important indicator of binary trading is the option redemption time. It is completely unimportant whether you predicted a market movement if at the time of the expiration of the option the price is not in the place where it was supposed to be according to the trade forecast, as the market can oscillate in different directions in a rather limited time range, and considering that the bulk traders trades contracts with expiration from 1 minute to an hour, then without correct calculation of this indicator, trading can be ineffective.

To correctly determine the optimal repayment range for bets, you first need to study the history of the market. Here you can simply calculate the candles of the chart with a certain period of construction (timeframe) to determine the most effective time range, which will effectively work out the signal of the strategy instruments.

Next, when calculating expiration, you should take into account the current volatility of the financial instrument market. For pulsed motion, it is preferable to use contracts with a minimum repayment range. At low quotes activity it is recommended to work with options with a longer range of repayment. A clear calculation of the time indicator of the action for each contract allows you to maximize the profitability and efficiency of trading.

• Managing

We determined the range of technical indicators that are necessary to create our own trading method for binary trading, it’s time for financial requirements for the work of the strategy. You should clearly understand that there are no systems with 100% efficiency. Each strategy gives a certain indicator of unprofitable contracts! Therefore, you must clearly understand what level of losses your strategy gives to properly manage your capital. Ignoring the calculation of risk management indicators can lead to a loss of capital even on the most efficient system. In this respect, you can use the classic limitations on the cost of options – it is usually recommended to use contracts that do not exceed 5% of the amount of capital. An alternative here is a test strategy on specialized services or demo platforms – in this mode, you must use the trade statistics to determine the number of unprofitable rates and calculate the level of the maximum allowable risks in trading.

• Testing the system

Undoubtedly, already during the development of the strategy you will test certain moments of its work. However, after the final configuration, the formation of the system template and the calculation of all the necessary indicators, it is extremely important to conduct a final test of the strategy’s work. Thus, you can finally make sure the system is working, evaluate its trading effectiveness in different trading conditions, and gain experience in its practical use. Believe me, this will definitely pay off in the form of profits!

Summary

Having passed all the stages of professional strategy development, you can create an individual and highly profitable trading method that will be optimal for your trading style. The optimality of all indicators of one’s own strategy is one of the main factors in achieving success by any trader in the binary market!

“General Risk Warning: Binary options trading carry a high level of risk and can result in the loss of all your funds.”

Best Binary Options Brokers 2020:
  • Binarium
    Binarium

    Best Choice!
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    Free Demo Account!
    Big Sign-Up Bonus!

  • Binomo
    Binomo

    Good Choice For Experienced Traders!!!

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