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Binary Options Strategies

Although a relatively straightforward way of trading, correctly predicting the future price of an asset is not an easy task. Without a reliable trading strategy, your chances of experiencing losses can potentially be magnified. Here we discuss some different techniques that you can adopt in your quest to become a more effective trader.

  • 01

    Trader Sentiment

    Many traders’ decisions can be influenced from observing other traders’ positions on a particular market, going long if it seems as if a majority of other traders are currently doing so, or vice-versa.


    However, trading with this sort of ‘herd mentality’ also has considerable drawbacks. Though trader sentiment can be a useful indicator of the markets, there is no guarantee that it will reliably predict an asset’s future movement. It is also uncommon for the majority of traders to hold the same position on an asset’s movement. Trader sentiment is typically around 50:50, making it difficult to forecast trends reliably from sentiment direction.

  • 02

    Predicting Market Movement: Technical analysis

    There are certain methods that are frequently implemented by traders to help forecast market activity and attempt to increase the chances of success. The most popular of these techniques fall under the categories of technical analysis and fundamental analysis.


    Technical analysis involves predicting the movement of prices through studying the history of a security’s trading pattern. As investor behavior often repeats itself, technical analysts believe that recognizable and predictable price patterns will emerge on a chart. Identifying such patterns can enable a trader to enter trades that are more likely to be profitable. Technical analysis relies on the assumption that a security’s market price is generally reflective of all external information relevant to that security. However, traders should always keep in mind that just because a market has reacted in a certain way in the past is no guarantee that it will behave in a similar way in the future.

  • 03

    Predicting Market Movement: Fundamental analysis

    Whilst technical analysts read charts to identify trends from past market data,

    fundamental analysts study financial statements, economic reports and news events which may reflect a security’s health or may influence its price.


    Keeping informed of relevant international news and financial news can help traders to profit from short-term market trends. For example, a change in government, natural disasters, and releases of economic reports can all have an effect on the value of a currency. Traders may also benefit from being up-to-date on the overall state of the economy, and from monitoring any changes to interest rates as well as news regarding production, earnings, employment, GDP and management – depending on the asset being traded.

  • 04

    Things to Look Out for Before Trading Binary Options

    Do use a certain amount of caution when analysing any one news event, as an incorrect analysis of an event’s influence on a market may result in losses if the markets move against your prediction due to unconsidered factors.


    For those new to binary option trading, be extremely wary of sites or software that guarantee a high success rates with binary options trading. Although the concept of trading binary options is straightforward, trading profitably is not as simple – so please treat these claims with a high degree of caution.


    Many traders use a combination of fundamental analysis and technical analysis to predict market behaviour. We advise traders to practice using these different techniques, perhaps with a demo account first – in order to gain experience and evaluate which strategy works best for you.

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