Overview of basic binary options trading strategies
Trading binary options is a draw to many people young (over 18) and old that are interested in making profitable trades over short periods of time.
Learn the basics first
With no financial background it is easy to get started trading and winning quickly. However with a few basic trading strategies and tips under your belt you can minimise your risks and increase the potential for a successful bet further. We have gathered a few basic binary options trading strategies to help you on your way.
Use Call Option in a bullish market
A Call option is used when you predict that the price of an asset will rise above its current price. As prices tend to rise and fall quickly over short periods of time analysing the market in detail is essential and if you notice that the market is steadily on an increase (bullish ) and it looks like it will continue to rise this is the best time to undertake a Call option. Be careful to keep an eye on your options as even mini fluctuations in an rising market means that you could fall outside of the money.
Use Put Option in a bearish market
A Put option is used when you predict that the price of an asset will fall below its current price. Just like a call option you need to continually analyse the financial markets and look for trends and patterns. If you notice that your assets price is at the start of a steady decline (bearish) then this would be the best time to place your Put option.
Single Asset Focus
As you may have noticed in the world of financial trading and binary options betting in particular there are many financial assets that are available to trade. This simple binary options trading strategy focuses on one asset in particular. If you already know about an asset in detail then work with that or you can gather as much information as you can about this single asset, its past trends and patterns, economic implications and overtime you can start to understand in more detail the reasons behind the movements in price. This will put you in a good position in the long run to be able to evaluate and predict the markets. This combined with the call and put options can be a profitable scenario.
Combine your Call and Put Options (Straddle)
Options can be paired together to form a straddle trading strategy that relies on both the ‘ in the money call ‘ and ‘ in the money put ‘ options. Basically put you can set a price at which you want to sell (put) and a price at which you want to buy (call) this creates a range in which you would be in the money reducing your risk if you time it right. This strategy relies on the fast-paced nature associated with online binary options trading and can be a great strategy for beginners to apply.
Overall you can either choose to employ a single trading binary option strategy or combine a few trading strategies for binary options in order to make a profitable investment scenario. When starting your trading adventure it might be wise to make smaller investments either a live or in a demo environment to see which strategies work best for you. Keep a track of what has worked and hasn’t can be advantageous so you don’t end up repeating the same mistakes.
Give them a try and then if you are ready for more advanced binary options trading strategies like Market Pull and Knock-on Effect click the link.
More binary options strategies