Knowing When Things are Overbought or Oversold

Using the overbought and oversold criteria to help you determine how to trade an asset is a great way to make short term profits, especially within the binary options markets. The trick is to knowing what these terms actually mean when applying it to an asset, and whether or not the label is fitting for the particular situation. For example, a company might fit the overbought definition on paper, but because they have such an exciting new product, they might not be overbought at all, and their stock price is likely to keep going up for the time being

Buy or Sell

Overbought stocks tend to gain the most notoriety right around the time that a bubble bursts. Consider the auto industries a while ago, as well as financial stocks back around 2008 and 2009. Some analysts see this happening–hopefully on a smaller scale–in the tech industry right now. It makes sense, especially if you think back to the late 90s and early 2000s when the dotcom bubble burst. A lot of companies that had public stock offerings went belly up because they didn’t have the fundamental attributes to keep them at the price level they were being traded at. This is, unfortunately, a common occurrence in the stock market. A sector catches fire and prices all over go way up, even within companies that don’t deserve to have this happen based upon their numbers.

So, what do these analysts see happening? Right now, tech stocks, like Apple, Google, and Microsoft, are extremely popular because they offer a great product. Other companies don’t have the financial clout to match these bigwigs, but they are still seeing success. These companies are not in a good situation, and a price reversal could easily happen once reality catches up to them. Companies like Twitter and Facebook stand a lot to lose just because they are newer stocks, have been walking a very fine line to stay ahead of predictions, and are in a quickly evolving subsector of the tech industry–the social media sector.

On the other hand, there are many companies that are definitely oversold right now, meaning that their prices could easily go up when traders catch on. Many of these are not as big as the overbought companies, but there are some binary options brokers that offer them. Companies like Citrix, Intuit, and SanDisk all have great products, a strong foothold in their respective subsectors, and have low prices based upon their fundamental data.

Figuring out how to time these trades correctly can be tough. Usually, if you are trading in the binary market, the best way is to wait until the movement is imminent or already in action, and take a short term position on them. A lot of these things require patience. For example, if Twitter is going to drop in price dramatically, it probably won’t be for a couple weeks. They are announcing their earnings numbers on February 5th, and if it’s a disappointing number, you can bet that their stock price will drop quickly.

Be prepared for this if this is a trade you are looking to make. The beauty of binaries is that you can make big profits off of little trades, and this is an opportunity for that to happen. You need to be monitoring things, but action doesn’t need to be taken until you are sure that it will be a profit for you. February 5th, for example, is still a bit of time away, but staying on top of things is a good idea until then so that you can make the very best choice when the right time comes.

Fundamental Strategy Tips for Winning

No doubt, those who trade binary options are in an excellent position to generate substantial profits. However, the profits earned will be directly linked to just how well a trader is able to forecast price movement. Profit totals are also linked to trade selection, and this includes the selection of the optimal instrument, investment amount, and expiry time. If you are one of the many who are new to this form of trading, consider the following tips for maximizing profits right away.

Financial risk must always be taken into consideration. As a general rule, traders are advice to not risk what they cannot afford to lose. This is a bit too general though, as traders should have a specific money management plan in place to allow for steady profit building. This plan should also help to compensate for inevitable losses. When first starting out, make firm decisions in regard to investment amounts, and do not under any circumstance allow emotion to be the driving force behind these decisions.

Another helpful tip is to carefully select each expiry time. Unless some type of sell feature is used to exit a trade early, all will end when the expiration time has run its course. Many traders opt for shorter expiry times, as these can provide quick profits while not locking up account funds for very long. Do keep in mind that fast trades can produce fast losses. The tip here is to based the expiry decision on analysis findings. If a longer period of time is needed in order to produce the highest odds of winning a trade, ignoring this fact could prove costly.

Always be looking for anything that could provide some type of advantage. This could be anything from a market report that sends an asset price into a trend, to a high return rate being offered on a low-risk option. Trading signals, analysis reports, optional investment features, and more can definitely be helpful at times. It should not take long for new binary options traders to learn where specific advantages come from, after which these opportunities can always be taken full advantage of.

Lastly, always select your instrument and asset class in accordance with current market conditions. There are instruments for all types of price movement, and some asset classes will be better than others under certain conditions. This tip may seem quite basic, but the importance of optimal selection of the instrument and asset group cannot be overstated. Winning positions start at the fundamental level, with the select of these two elements.

These basic strategies should become habits, as each action will be important on a daily basis. Those who have already begun to trade and are not achieving a reasonable win rate should consider the aforementioned tips, checking to see if related problems exist which can be easily corrected. The approach that one takes towards binary options trading from the very beginning can and will make a difference in the total amount of money that is being earned each day.

Picking the Right Trade Times and Money Management

Although it may not seem apparent at first, there does exist a link between trade expiration times for binary options positions and fund management. Expiry times range from 30 seconds (or in rare cases even less), to one full year. Account funds change along with each trade that is opened or closed. As these changes occur, decisions will need to be made in regard to fund allocation and future investment amounts. Understanding the link between expiration times and fund distribution will help to eliminate a number of common problems.

There are two key benefits associated with the selection of shorter expiry times. These would be the potential to turn fast profits, along with the fact that these trades do not tie up account funds for an extended period of time. For some, having account funds locked up for longer time-periods may not be a viable option. Quick profits can provide quick loss recovery, but keep in mind that fast losses can certainly be problematic. A reasonably high win rate will be a must in order to avoid the issues associated with “rapid-fire” trading. As always, traders are advised to track their win/loss rates at all times.

Longer expiry times will lock up funds for a longer period of time, but they can be an important part of a money management plan that includes more steady profit building. Analysis can be quite the chore when working with long-term binary options trades, as forecasting future market conditions can be tough. On the other hand, those who are able to access market conditions over longer periods of time may certainly benefit from the use of extended expiry contracts. Note also that extremely lengthy periods are not the only option, as long-term positions may last a day or even a week, depending upon the options provided by the selected broker.

There are also mid-range contracts to consider. These time-frames do not fall into either the short or long term categories. These contracts can be the perfect option for those who fear the risks associated with fast trading, but would rather not have funds locked into positions over longer periods. The process of analysis tends to be simpler when working with mid-range periods, as it eliminates errors that come from analyzing volatile markets, while also eliminating errors that can come from long-term predictions. Many successful traders do choose to work with mid-range expiration times.

One of the most popular money management plans includes the use of a set percentage of overall account funds, regardless of the expiry time chosen. This type of plan can work well, but traders can still run into problems when exclusively selecting short-term positions. While one strategy may work extremely well for one, it may not provide the same results for another. Each trader differs with regard to trading style and fundamental methods. While this fact may seem disheartening on some level, the fact of the matter is that those who trade binary options are always able to perform only the actions which deliver the greatest level of success.

How to Use the Option Builder Feature

Many binary options brokers now offer an Option Builder, or similar trade customization feature. What this feature provides is the means to create a new trade using the exact parameters you wish to select. All platforms do provide a current list of pre-designed options that can be purchased, but at times, traders may not wish to utilize these. At these times, the trade creation tool can be used to set up the type of trade that is desired.

Using the Option Builder

There are some limits to this feature. For example, it would not be possible to select an underlying asset that the broker does not offer within their asset index. Minimum and maximum investment amount rules will also need to be followed. Although there are some restrictions, all of the available instruments, optional features, assets, and expiry times that the broker does provide will be available for selection. This fact alone means that the possibilities are virtually endless.

One of the main benefits associated with this feature is the fact that risk levels can be better controlled via customization. As different parameters are selected, traders will be able to see how to offered payout rate fluctuates. Lower offered returns are linked to lower risk trades, with the opposite applying to higher payouts. This knowledge alone will go a long way in helping with trade creation in relation to risk appetite.

Use of this feature is similar to standard trading within the provided platform in that it will still be necessary to select an instrument, underlying asset, expiry time, and investment amount. Note that not all instruments may be available for selection. The standard Call/Put trade will be an option, but high-yield trades such as One Touch likely will not. Other optional features such as Sell, Double Up, and Rollover may only be accessible in the trade builder area. As with all things related to a binary options platform, it is wise to learn how to use Option Builder prior to actually using it.

Those who plan to use signals may need to use this tool as a means to enter into signal-based trades. When a trade alert is delivered, it comes with very specific information for taking the trade. There will be times when a matching option is available within the listing of upcoming trades, but if not, trade creation is likely to be the only way to create an exact match. Signals can be an effective way to boost earnings, but they can only do this when they are used as instructed.

Often, Option Builder is viewed as a feature that should be exclusively used by experienced traders. While a first-time trade may not want to use this feature, it can be put to use rather quickly, within the first week or so of trading. There really is no wrong time for its use, so feel free to utilize it at any time. Variety within a binary options platform is extremely important, and this feature provides access to nearly everything that a platform has to offer.

Taking a Deeper Look at the Broker Platform

Within the investment platform of every binary options broker lies windows which allow for trade execution. Even though no two platforms are the same, there are plenty of commonalities among trade windows due to the fact that the basic steps of trading digital options remain the same. As simple as they tend to be in design, the first-time trader may need a little assistance in figuring out how to use the trade window. Here, we’ll break down the general features of these all important platform components.

Learn the New Features

Almost every online binary options broker review is going to mention the features of the investment platform. Feel free to make use of this information when selecting the broker you want to partner with. As helpful as this information can be, don’t stop at just reading reviews. You’ll want to go one step further in actually visiting the broker website and having a look at the platform for yourself. It shouldn’t take long to determine whether you personally feel that the platform is user-friendly or overly complicated. While completing this step, take note of whether trades are offered in single or multi format. Some brokers do offer both styles.

Although the general look is going to vary, each investment window should contain the following information and trade parameters:

Underlying Asset
Strike or Starting Asset Price
Expiry Time
Payout Rate
Investment Box
Live Price Chart or Graph

For basic binary options trades, you’ll be presented with the Put and Call options. These are generally presented in button form, and should be two different colors. Charts and graphs are usually built in. These can be used to forecast future price movement prior to purchasing a binary options contract, and can then be used to track price movement once the contract opens. Every single one of these elements are important, so if you’re new to trading, go ahead and familiarize yourself with them.

Most traders seem to prefer single trade windows as they offer a less cluttered view and help to eliminate confusion. When using this type of window, you should be able to purchase a binary options contract in only a few simple steps. Typically, you’d need to select the instrument you’d like to use, select put or call, select the desired expiry time, enter your desired investment amount, and then click purchase. The steps for using other instruments are going to vary from these, but some of the basic steps remain the same. Options Builder, a feature offered by some brokers which allow you to build a trade to your specifications, is slightly more involved, but not by much.

The platform window is one area in which binary options scams have been detected in the past. Even if you’ve carefully screened a broker, it may be wise to put the window to the test. What you’ll want to be looking for is any discrepancy in the asset price when compared to that with a reliable outside source. The expiry time should also be compared to that of an outside source. Check to see if any lag exists between the time the trade ends and the time the result posts. This can take a few seconds, but should not take much longer than this. With this being said, if you’re using an old computer or slow internet connection, don’t automatically assume that loading lags are an issue on the side of the binary options broker.

While trading, you’re going to be working with these investment windows over and over again. Nearly all brokers now provide “how to” guides for the use of these windows. New traders are always advised to make use of the educations resources provided by their binary options broker. Whether you opt for the single or multi window format, always remember to take your time when selecting your trade parameters. Though cancellation may be an option, it’s best not to take any chances. Double-check your entries to ensure that they are just what you wanted them to be to avoid problems.

Binary Options Signals – Try Them?

Are binary options signals a guaranteed method of earning more money from the markets? The answer to that question actually depends on a number of different factors, ranging from where the trade alerts come from to whether or not they are used correctly. Overall, signals are viewed as being beneficial information that reduces the need for analysis while boosting profits. However, there are a few potential drawbacks that need to be taken into consideration.

Trading Binary Signals

The pros are quite clear. A signal will provide all of the information needed to enter into a trade that stands higher odds of finishing in the money. Even better, this information is provided with no effort required on the part of the trader. The only required effort will be to take the information and use it to take the suggested trade. When using a reliable service provider, a win rate of up to 70% or even higher can be expected, but keep in mind that some days will certainly be better than others. No provider, no matter how good, can guarantee a consistent win rate of 80-90% or more.

When used in addition to standard trading, trade alerts can allow for faster profit growth. It is not advisable to depend solely on signals, at least not indefinitely, but they have proven themselves to be beneficial when used along with effective strategies. The key to unlocking all of these benefits is to find a reliable service provider. Just as there is no shortage of brokers, there is no shortage of companies who are ready to provide you with binary options signals. It is essential that traders consider each option carefully before making a selection.

The potential cons are quite clear as well, and fortunately, most are avoidable. One would be losses due to not following signals correctly. Each trade alert will provide very specific information for taking a trade. If any modifications are made, the odds of the trade finishing out of the money may increase. Take the time to learn how to use signals correctly before using them. Service providers such as John Anthony Signals offer an education section on their website to help with training. Be sure to take advantage of extras such as this.

Another possible drawback is signal delivery times. When subscribing to a service that is operational 24/5, there should be alerts for all time-zone. In such a case, some traders feel pressured to try to take every signal that is delivered, often getting frustrated when trades are missed. The truth of the matter is that no one can take every trade in a 24-hour delivery period. Instead, it is wise to trade during the hours that you normally would, taking the signal-based trades that are presented within that time-frame.

Similar to anything related to trading, there are both advantages and disadvantages to allowing an outside source to provide you with trade guidance. With money at stake, traders are advised to carefully screen each service provider in advance of paying for service. Thousands of traders use binary options signals each day, and that alone speaks to the fact that they do provide some undeniable benefits when coming from a reliable provider and used as intended.

Risk Free Trading Sites

There are a number of binary options brokers who now offer risk free trades as a form of bonus to those who create an account with them. This type of perk is not the same as a cash bonus, which typically requires a substantial trade turnover volume before the funds can be withdrawn. Instead, these types of trades allow the trader to keep any profit generated from their execution, while not resulting in any financial loss if they finish out of the money.

Broker promotions are quite common today. These types of offers are used by brokers as a means to draw new traders into their platform and to have them become loyal clients. Such perks can certainly work to the advantage of the trader who is creating a new account with a broker

for the very first time. Often, brokers will offer more than one type of bonus, placing no limits on the trader with regards to how many offers he or she can take advantage of.

So, how do you find risk free binary options trading sites? This type of information can often be found in online reviews. It can also be found by visiting the websites of any brokers that you may be interested in. Often, the current promotions will be listed on the homepage, but you may have to click on additional links in order to read all of the details of each promotion. The average offer is approximately five trades that come with no risk, yet provide the potential of generating earnings that will be credited to your account.

Although rare, you may need to speak with the customer support department to request risk-free trades. In certain cases, it is possible to haggle with a broker in exchange for better bonuses. This is especially true for traders who submit an upfront deposit that greatly exceeds the minimum requirement. Larger deposits often provide traders with “VIP” status, and with that status can come some extremely nice extras. Do not be afraid to ask for what you want prior to creating an account and submitting a deposit.

Risk-free trades are not without some conditions. Often, there is a financial limit to the value of each opened position. There could also be a few conditions linked to withdrawal, such as you may have to enter into a number of trades using you own funds before being able to withdraw any profit generated from no-risk trade contracts. Be sure to read through the terms and conditions in advance, so as to avoid any surprises when the time comes to withdraw your profits.

Do be sure that you have mastered the basics of trading before using any no-risk trades or bonus funds. The goal should be to make the most of these extras, as the chances are that they will not be offered again (though some brokers do have loyalty programs). Locating a broker that offers this type of extra is not at all difficult, but do be sure to screen each option carefully before making a selection. Attractive perks will do you little good if you’ve selected a binary options broker that is unable to meet your needs.

Top Tips to Avoiding Emotional Meltdowns

When trading binary options, nothing should be left to chance. The most successful traders are those who follow specific strategies rather than permitting emotions to influence the process of making decisions. Gut instinct and excitement should not influence decisions and the impact of emotions when trading must be completely understood. Those who ignore the importance of sentiment run the risk of trading becoming less controlled. The subsequent tips can help to keep you focused and out of trouble.

Base Every Decision Upon Facts

Identifying a promising price trend is more difficult than trading along with an existing one, but early detection of price movement is actually a necessity if you hope to profit greatly. Many traders are hesitant to trade against a prevailing trend, even when presented with data which suggests otherwise. It is all too easy to follow the trend, assuming that it will continue on forever, only to have a reversal or short-term pull back change the outcome of their investments. Facts are what will show you the correct path to follow.

Do Not Deviate From A Successful Strategy

There are a great deal of binary options strategies available to select from, many of which will help you to meet your specific goals. The strategies you select may not be as important as sticking with what works. Most proven and tested strategies have very clear steps which must be followed. While you may be able to modify or create your own trading methods at some point, it is wise to use trusted method according to instructions while progressing from a beginner level trader to a seasoned trader.

Do Not Act Out Of Fear (Or Greed!)

Both fear and greed can cause major problems. When 24option trading is going well and money is being made, some traders become overly generous with their investment amounts. Some feel that the win streak will last forever and aim to derive the most financial benefit from it, but after experiencing a sizable loss, become fearful and try to recoup the lost funds using large investment amounts. This type of pattern can be very problematic and needs to be identified sooner than later.

Never Panic

The reason that moment management is so important when trading is that it provides traders with the kind of self-confidence needed to make sensible decisions. Panic investing often takes place whenever account funds begin to dwindle and traders are eager to restore their account balance to a higher level. Traders may possibly feel compelled to boost their trade volume to recover losses, even when market conditions are not ideal. Do not panic. Controlled trading will place you back on the right track.

Emotions can wreak havoc if you allow them to. Although some emotions may protect you from unwise decisions, many can point you in the wrong direction. There is no way to stop feeling, therefore no way to eliminate problems entirely. However, you can remain sort feelings from facts, thus protecting yourself when entering into binary options trades throughout each day.

Taking Your First Trade

Binary options traders collect a pre-established return amount on all trades that end in the money. Anytime a trade ends out of the money, it is just the investment amount that was chosen by the trader that is lost. It is this clarity that makes for easy money management and of course helps when making trade decisions. This forthright process provides for a high level of risk control as well.

Take a Call or a Put

Because these trades are of a fixed duration, traders do not have to make many of the same choices that traditional market traders must make. There are no stop losses and there is no necessity to pick or exchange shares, since none are bought in binary options trading. While trading with some brokers, there can be a Sell option, but it is mainly used as a way to reduce losses any time your chosen asset is not progressing in the expected direction. This option is not mandatory though, and may be entirely disregarded if you so choose.

Fundamentally, a trade is the estimation of whether the value of your chosen asset is likely to rise or to drop. The asset price will have to be either above or under the entry price when the trade expires in order to receive any money. Let’s take a look at the way a basic Put or Call trade works…

Selecting an asset is the first step. This asset is only being used for a singular trade and therefore you will in no way own it. As soon as the trade is completed, so is your link to that asset. Once an asset has been decided upon, you are going to get started on the analytic process. While you do take expiry time into consideration, the expiry period is not actually determined until you secure your trade.

In a basic trade the objective is merely to estimate if the price is likely to be over or under the opening price point at the time that the expiry time ends. Your broker will display the entry price. Keep in mind, though, that this price may change. In the event that you see an entry price but do not act until a later time, it is possible that the price may be significantly different when you do return to finalize the trade.

If you believe the asset price will have gone up at the end of the expiry period, choose a Call option. If down, choose a Put option. The investment sum is your decision, but keep in mind that minimums, however low, do apply. Most 60 Second trades can start at as little as $5 and can go up from there. The minimum for most standard binary options trades is around $25.

Both basic Put or Call trades and 30/60/120 second trades function in the same manner. The sole difference being the expiry time choices. The 60 Second trades are the best option for quick trades. For a bit longer expiry time frames, going with the basic trades may be a smarter choice. With significantly longer trade times, Long Term binary options trades are generally the best choice.

Trading Gold using Binary Options

Gold is one of the world’s most popularly traded commodities, but many people stay away from it simply because they don’t want to hold it. It’s a legitimate concern; who wants to keep a safe full of bullion in their closet where it can take up a lot of room while it just sits there? Luckily, there are plenty of ways that you can profit off of rising gold prices without resorting to hoarding it in a secret place. Let’s take a look at a few different methods of making money off of gold without ever having to find a place to store gold bars.

Gold Receipts

Receipts can be redeemed for gold, but you don’t need to if you don’t want to. Instead, you can purchase receipts, and then either store them (many can be done so digitally), or sell them at a later date for a profit. This can be done through government organizations in some countries, or through private groups. Electronic tradable receipts are the simplest way to do this, just make sure you go through a reputable company before you invest anything. Also, make sure that they have many clients in order to increase the liquidity of your receipts.

Trading them through Binary Options

These are pretty new, but they open up a new world of possibilities with gold, and commodities in general. The big problem of trading commodities in the past has been ownership and the responsibility that comes with it. Binary options take on none of this as no changes in ownership ever take place. Instead, you are speculating on price movement, and that’s it. You can trade short or long term, although trading gold short term is not easy. However, because of the fact that you can make large profits off of small amounts of movement, this isn’t a big problem anymore.

Futures Contracts

This is how gold futures are traded, but their liquidity isn’t always the best. Basically, you are agreeing to purchase (or sell) a set amount of gold on a set date in the future for a set price. If the price changes enough between now and then, you make a profit. Most people do not wait for their contract to expire, but instead sell their future once prices have changed enough to see a profit. This prevents the delivery of the commodity itself, but there is a chance that you will not be able to sell off your contract and be stuck with fulfilling the terms of the contract. Unless you are dealing with large dollar amounts, this is often not worth the risk.\
Stock with some Gold

There are a ton of stocks out there that are related to the price of gold. The big ones are usually mining stocks, but you can also trade ETFs based upon gold’s value, as well as the Australian dollar. The AUD is especially powerful as this economy is very dependent upon gold because of its large mining industry. Finding a currency that is moving strongly in the opposite direction of the AUD can help you to increase your chances of being successful here. Usually pairing it up with another major currency is best as this will eliminate many surprises in your Forex trading.

What’s Best?

It depends on what your goals are, really. If you are a smaller trader, then binary options present a huge advantage since you can sometimes trade them for as little as $10, and still see a profit. In other places, fees and other expenses are too high to trade realistically with this little. They are also better for short term trading, especially if you intend on keeping your trades open for less than a week. Other forms of trading can give you the same degree of success, but you will need to invest much more at one time to see the same results.