Binary Options strategy for Beginners
Are you tired of losing money on binary options trading? Do you want to increase your chances of success and maximize your profits? If so, then it’s time to implement a solid strategy. In this blog post, we will introduce you to the RSI + Parabolic SAR strategy for Pocket Option. We will explain how these two indicators work together to generate accurate signals and help you make more profitable trades. But that’s not all – we’ll also cover essential topics like money management, the best times to trade, and common mistakes traders make. So sit back, grab a cup of coffee, and get ready to learn how this powerful strategy can transform your trading experience!
Why do you need strategy for binary options?
Binary options trading is not an easy endeavour, and many traders find themselves losing money more often than not. This is where having a strategy comes in handy. Without a plan of action, you are essentially gambling with your investments, and that’s never a good idea.
A solid strategy can help you make informed decisions based on market trends and indicators. It guides your actions towards achieving specific goals instead of relying solely on luck or intuition. By using proven strategies like the RSI + Parabolic SAR, you can increase your success rate significantly.
Another significant benefit of having a strategy is that it helps to manage risks effectively. When you have clear guidelines in place for when to enter or exit trades, how much money to invest per trade, and what expiry times to use – it mitigates the potential losses from poor decision-making.
In summary, if you want to be successful in binary options trading consistently, then developing and implementing a sound strategy should be at the top of your priorities list.
How to set the strategy?
In order for the strategy to be effective, it should be discontinued in as many configurations as possible. That is why it is so important to set the right parameters. For the purpose of this article, we have prepared the best parameters in our opinion. Remember that indicators are not everything and how you set up the chart is also important.
Chart type: Candlesticks
Timeframe: 5 seconds
SuperTrend: ATR Period 10, Multiplier 2
Parabolic SAR: Acceleration 0.04, Maximum Acceleration 0.2
How to use strategy?
The way the strategy works is very simple. I think that even a novice trader will be able to recognize CALL and PUT signals without too much trouble. When you add indicators in the right configuration you will see the SuperTrend, which with the help of red and green lines shows the current sentiment in the market. Parabolic SAR, with the help of dots above and below the candles, shows micro-trends on the market.
To open a CALL position: the SuperTrend must show a green line under the candles, and then the first dot under the candle generated by the Parabolic SAR must appear. When the signal appears open the position with an expiration time of 1 minute.
To open a PUT position: the SuperTrend must show a red line above the candles, and then the first dot must appear above the candle as generated by the Parabolic SAR. When the signal appears open a position with an expiration time of 1 minute.
What is SuperTrend & Parabolic SAR?
SuperTrend and Parabolic SAR are technical indicators commonly used by traders in the binary options market.
SuperTrend is a trend-following indicator that helps identify if an asset’s price is in an uptrend or downtrend, while also providing potential entry and exit points for trades. The indicator consists of two bands, with the upper band representing resistance levels and the lower band representing support levels.
On the other hand, Parabolic SAR is used to determine trends as well but works differently than SuperTrend. It places dots above or below the candlestick chart based on where it believes prices will go next.
Both indicators can be used together to increase their effectiveness in analyzing market trends and identifying potential trading opportunities. However, traders should always keep in mind that no single strategy guarantees success in binary options trading.
Understanding how these technical indicators work can help traders make informed decisions when entering trades on platforms such as Pocket Option.
One of the most important aspects of successful trading is proper money management. It’s not just about making winning trades, but also about controlling your losses and preserving your capital for future opportunities.
When it comes to binary options trading, it’s crucial to set a budget for each trade and stick to it. This means only risking a small percentage of your account balance on any given trade.
It’s also important to have a plan in place for when things don’t go as expected. For example, if you experience consecutive losses, consider taking a break and reevaluating your strategy before continuing.
Another key aspect of money management is diversification. Don’t put all of your eggs in one basket by investing all of your funds in one trade or asset. Spread out your investments across different assets and strategies to minimize risk.
Effective money management can make the difference between success and failure in binary options trading. By setting realistic goals, sticking to a budget, having contingency plans, and diversifying your portfolio, you can increase the odds of long-term profitability while minimizing potential losses.
What is the best time to trade?
One of the most critical factors that impact the success of a binary options strategy is timing. To determine when to enter or exit a trade, traders must know the best time to trade.
The best time to trade varies depending on market conditions and trading preferences. Generally, traders prefer trading during high volatility times as these are periods when the market moves significantly, providing opportunities for profit.
Traders can identify high volatility periods by monitoring economic calendars to track major news releases and events that could affect currency pairs or assets they’re interested in trading.
Another factor affecting the best time to trade is the trader’s location and time zone. Traders should adjust their trading schedule based on their local market hours because some markets may be more active during certain times than others.
It’s essential to note that not all strategies work well during all hours of the day. Some strategies perform better at specific times due to various factors such as liquidity levels and asset behavior.
Knowing when to enter or exit trades can increase profitability while reducing risks. Thus, identifying your ideal timeframe will depend on your availability and risk tolerance level while also taking into account possible market fluctuations in different regions worldwide!
What is the best expiration time for this strategy?
When it comes to trading with the RSI and Parabolic SAR strategy on Pocket Option, choosing the right expiration time is crucial for success. The expiration time refers to the length of time that a binary option contract remains open before it expires.
Short-term binary options have expirations ranging from 30 seconds to five minutes, while longer-term options can last several days or even weeks. However, this strategy works best when trading short-term binary options, ideally with an expiration time between 1-5 minutes.
The reason for this is that the RSI and Parabolic SAR indicators are most effective in identifying short-term trends in asset prices. By using these indicators in conjunction with a short expiration period, traders can quickly enter and exit trades based on current market conditions.
On the other hand, if you choose an expiration period that is too long, your trade may not be as responsive to price movements because there is less volatility over extended periods. Therefore, selecting shorter expiration times enables traders to make quick decisions based on real-time market data – which could result in more profitable trades overall.
How much money can you make?
When it comes to trading binary options, making money is the ultimate goal. However, it’s important to keep in mind that there are no guarantees when it comes to trading. The amount of money you can make with this strategy largely depends on your own skills and experience.
It’s important to have realistic expectations. While some traders may see significant profits, others may break even or take losses. It’s all about finding a strategy that works for you and sticking with it.
Money management is key when it comes to maximizing profits while minimizing losses. This includes setting stop loss orders and not over-leveraging your trades.
The best way to increase your chances of making money with this strategy is by thoroughly understanding the indicators being used (RSI + Parabolic SAR) and how they work together in different market conditions.
Ultimately, the amount of money you can make with any binary options strategy will depend on a variety of factors such as market volatility, asset selection, timing of trades, risk appetite and more.
When it comes to trading binary options, there are a few common mistakes that traders often make. One of the biggest mistakes is not having a solid strategy in place. Without a clear plan for entering and exiting trades, you may find yourself making impulsive decisions based on emotions or market fluctuations.
Another mistake is failing to manage your money properly. It’s important to set a budget for your trading activities and stick to it. Never risk more than you can afford to lose, as this can lead to financial ruin.
Some traders also make the mistake of trading at the wrong time of day. For instance, if you’re located in Europe but only trade during US market hours, you may miss out on opportunities that occur when markets are open in other parts of the world.
Many traders fail to choose an appropriate expiration time for their trades. Depending on your strategy and goals, different expiration times may be optimal.
Avoiding these common mistakes can help improve your chances of success when trading binary options with Pocket Option or any other broker platform.
After learning about the RSI + Parabolic SAR strategy on Pocket Option, you now have a better understanding of how to trade binary options. By combining technical analysis tools like SuperTrend and Parabolic SAR with effective money management techniques, you can increase your chances of success in trading.
It is important to remember that no strategy guarantees 100% profit every time. Therefore, it is crucial to remain disciplined and patient when trading with this or any other strategy. Always follow your trading plan and do not let emotions guide your decisions.
Additionally, it’s important to use these strategies during the best times for trading and choose the right expiration time for each trade based on market conditions. This can take some practice but will ultimately pay off in increased profits over time.
By using the RSI + Parabolic SAR strategy effectively on Pocket Option along with proper risk management techniques, traders may find themselves achieving greater levels of profitability in their trades.
Is this strategy suitable for beginners?
Yes, this strategy is easy to understand and apply. Beginners can learn how to use the SuperTrend and Parabolic SAR indicators in just a few minutes.
What is the minimum deposit required on Pocket Option?
The minimum deposit amount on Pocket Option is only $50. This means that you don’t need a huge investment capital to start trading with this broker.
Can I use this strategy on other platforms besides Pocket Option?
Yes, you can use this strategy on any binary options trading platform that offers the SuperTrend and Parabolic SAR indicators.
How much money can I make using this strategy?
There’s no fixed amount of money you can make using any trading strategy. Your earnings will depend on your trading decisions, market conditions, risk management skills, among others. However, if you follow the rules of this strategy carefully and trade wisely, you have good chances of achieving profitable results over time.