Strategies for Working with Binary Options – Formats of Market Forecasting

Published:9 January 2017 Updated:4 January 2024

Trading strategies – is one of the necessary attributes of binary options trading. It depends on how effective it will be trading system chosenThe effectiveness of the trader’s work on the options market also depends on it. Undoubtedly, binary options are in themselves the most simplified financial trading tools, but taking into account the fact that more and more newbies come to the options market today, in our article we decided to show by practical examples the main formats of market analysis, which are used by professional options traders.

So, there are only two basic approaches to financial market forecasting that are used not only in binary options, but in all formats of financial trading:

  • Technical analysis is an approach in which the generators trading signals Technical parameters of the market: price levels, patterns of quotations, volatility, as well as automated analytical programs – technical indicators, which through their work on the chart of an asset are able to determine and inform the trader of the further market trend.
  • Fundamental analysis – this approach is more professional and involves the use of macroeconomic statistics of economic sectors of entire states, as well as the performance of large corporations.

Thus, all trading strategies are built on one or another approach, and sometimes even on a combination of them. Therefore, depending on which approach and toolkit is the basis of a trading strategy, all binary strategies are conditionally divided into the following categories:

Now let’s consider examples of each type of trading strategies that can be used to work in the most profitable mode, providing a stable growth of the deposit.

 

News trading

From the name of this approach it can be guessed that it is based on the principles of fundamental analysis, and the strategies of this type use certain news publications, significantly affecting the fluctuations in the quotations of certain trading assets. That is, the basis of trading is the natural reaction of asset quotations to the publication of macroeconomic statistics. For example, asset quotations NEFT In this case, the player can make an impulsive jump at the moment of publication of statistical values about reserves of this raw material in the storages of the main consumer or about the volume of its production by the main cartel participants. Knowing in advance when such news will be published and the algorithm for its use in trading, the player can use this pattern for effective option trading. Therefore, all the trader needs to do is on the analytical page at economic calendar Choose announcements of important macroeconomic publications, and make a deal in time on the results of the released statistics:

Strategies for Working with Binary Options - Formats of Market Forecasting

Such a table specifies all the information necessary for trading: the announcement of the news, the time of its release, and the asset it will affect. Statistical data is also specified: previous and forecasted. Thus, the trader needs to choose an asset and make a deal based on the data released, guided by the following principle: negative news leads to a decrease in quotations, and positive news leads to their growth:

News trading

This is how the price of oil reacted to the fact that the stocks of its main consumers decreased. Therefore, making a trade at the moment of news release can be guaranteed to complete it with profit.

 

Indicator strategy

The name of this category of trading techniques also speaks for itself – all systems of this type are built on the work of technical indicators, which independently evaluate the asset market and produce trading signals about the changes in its movement trend. Strategies of this type are the most popular among the option traders, as they are characterized by ease of use, high accuracy and wide range of tools. In addition, a trader can create different universal indicator approaches by experimenting with the settings of indicators and their combinations. Let’s consider an example of a simple strategy with indicators: on the platform broker INTRADE.BAR from the indicator set it is necessary to set the MACD, RSI, SMA indicators on the chart without changing their settings. These indicators generate a complex trading signal, which consists of the following indicators:

  • SMA indicator – the moving indicator indicator will be crossed by the quotes in the upper direction
  • RSI indicatortrend line will move with an upward trend
  • MACD indicator – oscillator lines will cross and diverge from each other in the upper direction

On the basis of such a complex signal a trade bid UP is made:

Indicator strategy

Bets with the forecast DOWN are made with a reverse interpretation of the trading signals. With such a simple strategy, you can increase your capital up to 300% every week.

 

Technical analysis

Option trading systems of this type are based on certain patterns of price fluctuations, candlestick and wave patterns and the use of graphical tools. As a simple example, let us consider trading inside the price channels. The signal to make a deal here will be achievement by the quotations of level of support or resistance:

Technical analysis

This strategy can be used on any trading assets, so you can steadily and dynamically increase the volume of the deposit account.

When choosing a suitable trading strategy, it is worth considering the need to test each technique before starting to use it. In this regard, it is best to use demo account for training trading, offered by Intrade.Bar broker. On the real trading platform the broker provides virtual money with which you can test the system’s performance on real market conditions:

Demo account for training trading

At the end of the article we give you a recommendation – for the most profitable and productive trading apply only verified and understandable for you trading strategies with a simple format for the identification of trading signals. Exactly on such terms of trading getting profit will be maximally pleasant and comfortable process. Besides, choose carefully the company you are going to work with. It should be reliable. Binary Options BrokerFor example, look at the platforms Binarium, PocketOption or Binomo.

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