Top 5 Binary Option Strategies For Beginners

Top 5 Binary Option Strategies For Beginners

Submitted by adil on Thu, 12/04/2014 - 08:46

You might have come across many trading strategies during your quest for the best possible solutions, but not all of these strategies prove to be good for binary options trading. Some of these strategies might not suit your style of work or might be too complex for you if you are a new trader. Here are a few strategies which will help newbie, as well as experts of binary options trading.

Essential strategies:

These strategies are quite simple to act upon and form the basis of trading education. 

1. The “Trend is your friend” strategy:

This rule is being used in trading and finance for quite a long time although no one seems to know who actually came up with this concept. The idea behind this strategy is a little more complex than just following the trend.  Buying an up-trend or selling-off down trends is not enough every time. Sometimes you have to wait for trends to pull back or rise higher before buying or selling them. Trends show you the right path to follow especially when you are setting up a new business. Future is unpredictable but you can reduce the probability of failure by trading according to the price movements.

2. The 1-2-3 system strategy:

Also known as the swing system because it is as simple as counting 1-2-3. The strategy basically works on trade reversals. It is used to find trend changes through chart patterns and is in common practice. Although not 100% successful, but it is by far the most accurate system. Believe that once you get familiar with this method you will notice these chart patterns are crowded all over the place with opportunities and are dead useful throughout the beginning, downfall and rising of a trend.

3.  MACD entries strategy:

MACD is Moving Average Convergence Divergence indicator and is considered a very useful strategy for new traders. You can use this tool to measure changes in trends and also reversals. You can also determine course signals for binary options trading. This tool is flexible in time frames and can be used for very short as well as for long time frames, although the best time frames are short e.g. five minutes.  If you know this tool well, you can do wonders with it!

4. The Pinocchio strategy:

The Pinocchio bar is a candle bar with a small body but a very long wick, hence the interesting name. A more professional name is pin bar. This tool is suggested to beginners because it is an easy money method. The length of the wick indicates the rise and fall of asset prices allowing you to trade against the market.

5. Binary options hedging strategy:

The hedging strategy gives you an opportunity to manage risks effectively. In this process, an off-set trade position is created where a call is hedged by a put and a put hedged by a call. This strategy allows you to limit your losses. Isn’t that wonderful?

These are the five basic strategies which will help you in binary options trading. Remember, not every strategy is helpful in every situation but if it can make your trade survive another day, go for it!