Binary options: starter kit
Most of us dream about the job which pays the rent and doesn’t require much time and effort. Most think that binary trading is the one. At some point you are correct, binary option trading can become a solid everyday income source. But in order to make trading your stable income you need to learn how, when and what to trade. Seems like a hard time? Not really. In that article we’ll give you a step by step guide that will allow you to start profiting from the first day.
Step 1. Choose a graph
Basically, the linear chart is quotes’ values connected by lines for better visualisation of the trend. That graph type is not only simple, it is simplistic. The chart summarises data and makes it easier to define a trend. The graph is not overflowing with too much information, it is simple to read and understand the chart. Professional traders will not be satisfied with area chart, because it does not provide full detailed information needed for analysis.
Candle chart is a great representation of quotes’ movement. Each candle contains the information about quotes’ movement during a chosen period of time (30 seconds, 1 minute, 5 minutes, etc.) If the candle is green, it indicates the rising movement of quotes, while red shows quotes were falling down during the chosen period of time. We recommend you to learn how to read candle chart to improve success of your trading
Step 2. Choose an asset
Spot FX Currency Pairs. Value of a currency is defined by its comparison to another currency. The first currency of a currency pair is called the base currency, and the second one is called the quote currency. The most suitable pair for beginners will be EUR/USD which usually has a lower amount of volatility. Currency pairs are traded 24/5 as that is certainly a global asset which is one of the most dynamic instruments and is in the constant state of change.
Examples: EUR/USD, GBP/USD, USD/CAD.
Equity Indices. Indices are a group of assets. Indices are computed from the prices of selected stocks or can also represent a special group of companies, such as new technologies or mining.Traders can invest in movement of group of stocks by trading only on one indice. It is beneficial from a cost standpoint, as well as for diversification. Indices are traded 24 hours as stock markets are opened in various timezones around the world.
Examples: FTSE 100, DAX, Dow Jones, Nasdaq 100.
Spot Commodities. Commodities are real physical goods which are actively influenced by impacts around the world. Commodities are much more stable than other assets, thus is safer to trade. Price of commodities can often be volatile, it can be influenced by weather conditions, market news, USD value, government trade policies.
Examples: Gold, Silver, Crude oil, Platinum.
Stocks. Stocks are shares issued by corporations in order to raise capital. Traders need to monitor market news releases, earnings reports, economic events to predict the movement of stocks.
Examples: Apple, Microsoft, Google, Facebook, Twitter.
Step 3. Choose an option and expiration time
Short term option. Expiration time is from 30 seconds to 5 minutes. In fast paced business like binary options trading most people prefer to trade on short expiry and get result of a deal as soon as possible. You can profit in only 30 seconds after opening a trade. If you are the one who prefer instant results of your actions then Short term trading is for you!
High/Low option. Expiration time is from 15 minutes to 1 hour. That is a classic type of options, the most popular one. There you can benefit from use of technical analysis as well as long term strategies. With High/Low you can take higher risks and invest more when proper analysis has been made.
One Touch option. Expiration time is from 15 minutes to 1 hour. That is the most unusual and interesting one for those who like range and boundary trading. Traders predict whether a certain asset will reach a preset target price or not.
Step 4. Set investment amount
You can start with only $5 and gain profit in 30 seconds on Short term options. The more you invest the more profit you get. It is recommended to prepare your trading budget before you enter the market with real funds. Till that moment you can practice on our demo platform where you can try on various strategies and find your own trading style.
Step 5. Open deal
The last will be choosing if price will be higher or lower at the expiration time. Then it is easy, you choose a "Call" button if you want to invest into the rising movement of quotes. You click on "Put" button if you expect quotes to fall.