Tips to Rule Your Trade
There are several basic trading rules for people who are trading binary options. These rules are simple and straightforward and are there to make your trading experience profitable.
The first rule that you should follow even before thinking about transacting a trade is to conduct due diligence on the trade you are thinking of doing. This means that you should research facts about the asset. Never ever trade on gut feelings. The reason for deciding whether to trade high because the assets price will move higher or trade low because the asset price will move lower should be based on what you can learn from technical analysis charts, or from reading the financial press, or from conducting some fundamental analysis of economic news and statistic.
The second rule is to just concentrate on a few assets to trade binary options with, rather than trade all types. Get to know the characteristics of the assets really well. Take one asset class and concentrate on that for a while until you get to understand it fully. Then go on to another asset class and learn that fully too. The more knowledge you have about an asset, the more you will understand why it is moving up and why it is moving down. Also, try to understand the positive and negative links between asset classes and within asset classes. There are currencies which are linked to commodities either positively (they both move the same way) or negatively (they move in the opposite direction). There are also currencies which are linked to other currencies in the same way. It pays to learn the characteristics of these links and use this knowledge for trading.
Rule number three is to do with how you manage your money. You should always have a plan and know how much money you are willing to risk on each trade, or risk in a day. By planning carefully you can make money through online .
Rule number four is all about strategy. You should always have a plan when you are trading binary options. If you decide for example that a particular commodity will continue in an upward trend, because all the analysis you have done points to a particular plan, keep to it, even if you lose a trade because for a few hours there was a ‘bounce’ in the market. If your plan is sound the upward trend will continue after the small hiccup. The same applies for downward trends too. Of course if the market trend changes from that which you are following you should adapt your plan and change your own plan accordingly.
The final rule is the most crucial to a successful trading career. It is a logical progression to swimming in the shallow end before progressing to the deep end of the swimming pool. Most binary option brokers have demo accounts which you can use to practice your trading strategies on. Make sure you use them to get to know the trading platform, and to test out your trading plan and strategy. Remember that if you are not making money trading with a free demo account, there is no way you will make money trading with real money.