Trading Binary Options On The Trend
The adapted and technological structure of the binary option’s operation on the financial market, which is used by online investors in their trading, allows for the use of the widest possible range of forecasting strategies in binary trading. However, there are so many more effective and simpler methods of obtaining stable profits. We recommend the “On the trend” trading strategy for working on the binary market as one of the most effective methods of generating forecasts. This method is the most accessible for non-professional traders and maximizes the security and speed of increasing the amount of capital gains.
The «On the trend» trading strategy – technical requirements
The overall effectiveness of the use of this strategy will depend, in the first place, on the tools and services of the trading platform, and on the trading conditions which may affect the correct application of the established rules of money management. Obtaining convenient and technically suitable trading conditions on the binary market will require a terminal equipped with the following services:
- A trading quote chart with zoom functionality and temporary timeframe settings
- Accurate market quotes
- A selection of highly liquid assets
- Increased profitability of trading bets
- The availability of chart forecasting services
- Access to expiration periods from 3 minutes
- The minimum trading conditions on the market
Such a list of services, conditions, and tools can be found on high-tech terminals from brokerage firms. As the most optimal and stable operating platform, we suggest taking advantage of the terminal from the European Binomo broker. In this case, online investors on the binary market can benefit from the following list of trading tools:
- A trading chart of the underlying asset with the required list of settings
- Market quotes of high accuracy
- More than 80 kinds of financial trading tools
- Profitability of trading contracts of up to 90%
- A set of chart services
- Frequency of bet expirations from a minute to a day
- Trading conditions – an initial account from $10, the minimum cost amount of bets from $1
So, techniques for trading on the trend are based on patterns of market movement. Despite the fact that quotes move in a certain direction, the asset price does not follow linear oscillations – when building in a certain trend direction, quotes carry out a number of rebounds and correction reversals. The task of the online investor includes the precise identification of the optimal points for bet registration during price movement on the trend. For this, special technical analysis techniques are used – defining the trend levels and trading off them.
To build support or resistance trend levels, upon reaching them the price responds to certain patterns of movement, it is necessary to use the special trading platform tool, “line”, to connect the highs of quotes to get resistance, and the lows to get support:
Thus we get the cost level of the asset, which allows us to register bets with a high level of positive expiration. In this case, we use the support line of an uptrend and the pattern of rebounding quotations upon reaching it.
For binary options on a downtrend, use the resistance line and the same signal format for bet registration – prices rebounding from the support level:
The list of techniques for the “On the trend” trading strategy should include the possibility of trading in price channels. To do this, you need to build both formats of trend levels at the same time, meaning you will outline a border for quote price fluctuations during trend building. This method allows you to execute highly cyclical contracts in two ways:
This type of trading system for binary trading has a high level of efficiency and signal accuracy – roughly 87% of contracts are positive. This allows online investors to dynamically and steadily increase the volume of their trading funds.
When using the “On the trend” trading strategy, it is recommended to use trading bets with expiries of 3 to 5 minutes. When increasing the temporary chart timeframe, also increase the expiry period of the bet according to the following rule – before the expiration at least 5 quotes candles should be generated on the chart.
Money management for the «On the trend» trading strategy
In this regard, to maintain a safe trading mode we follow the classic rules of risk management – for minimum investments we use bets of the initial value, for large amounts of operating capital, we limit the amount of the cost of the bet to 5% of the total volume of trading funds.