Understanding How to Choose the Right Binary Option Expiry
As someone who does binary options trading, I can tell you that while it are rather simplified compared to other forms of trading, such as stocks for example. Finding success in the actual trading is another matter entirely.
This is because there are many different factors that must be calculated in binary options trading, some of which can only be guesses and there are outside forces that may affect your success that cannot be predicted. I remember that it took quite a while before I was able to better understand all the elements required to make the most successful trades possible.
Arguably the most important aspect is choosing the right binary options expiry possible so that you can maximize your efforts on each trade.
Based on my experience, what follows are the basic elements required to maximize the success of your binary options trading. These are the factors needed for you to choose the right binary options expiry for your needs.
This is arguably the most important factor as the longer the time frame, the longer the expiries will be. It’s important to break down what time frame will work by comparing these three charts;
The time frame you choose will have its own unique affect on the trade. The longer time frame that is chosen, the more variables that can affect your trade will appear. Basically, you want to see how the charts map the time difference between the signals and the actual development of the price change. At that point, I choose the binary options expiry that best fits that difference and make the trade.
Other Factors to Keep in Mind
Naturally, there will be many other factors to consider as well, including the following;
– Levels of Support & Resistance
– Convergences & Divergences
While many of my friends swear by the news being a reliable indicator, I am not quite in their camp on this. While it is important to follow the news events that are related to the asset in question, it will depend on the type of news, such as economic, political or simple earnings. News needs to be kept in its proper place in binary options trading.
I use support and resistance levels to measure areas in the market that are changing direction. If I seen an asset that is rising on the daily charts, then usually the correct move would be to pick a week long binary options expiry assuming that all the other factors fall into this line as well.
Convergences and divergences are another important factor I take into account when considering trades. When I see a convergence, which is the price action and at least two other indicators going in the same direction, I am much more tempted to make the trade. Conversely, when a divergence happens with indicators going in different directions, I become much more skeptical about trading.
All in all, it pays to know and understand the charts so you can get as accurate a picture as possible when it comes to choosing the right binary options expiry.
If you focus on one or two assets and learn their trends, it can really help you over time in getting the best results from binary options trading.