Binary Traders Should Learn From The Forex Industry
Try searching for information on how to trade binary options, and most of what you’ll get will be scams. Now try searching for Forex, and you’ll see the search results are a lot different. There are still scams in the results, but most of what you’ll see will be brokers and news sites. Despite this gap, both binary options traders and FX traders struggle with the stigma that they are gamblers—probably because a large number of both are indeed gambling for entertainment, whether they acknowledge it or not. There are professionals in every market, however, and that includes FX as well as binary options. Why then this huge gap in the information for each? And why should you be interested in researching Forex if you’re a binary options trader? How can currency trading resources help you to improve your binary options trading?
Use A Strategy To Be Pofitable Long Term
If you want to be a profitable long-term binary options trader, and not just a gambler, then you’re going to need trading strategies—or at least one really good one. You don’t need piles of different methods or indicators, just one thing which works really well for you. That method might be simple or complex; it may involve technical analysis, trading based off news reports, or price action. Whatever method you use, though, it needs to be concrete, something you can demonstrate, and something you can repeat time and again for excellent trading results.
Binary options trading allows you to trade numerous different types of underlying assets. You might trade indices, stocks, currencies, or commodities. Whatever you choose though, you need a method. And that method needs to be specific and consistent. It can’t be “Well, I’ll just go along with what everyone else seems to be doing,” or “I’m going to go against the trend and win.” And while there are a lot of signal services out there (some of which are probably even good), a signal service is rarely a reliable, good choice for a new trader, either.
When you attempt to find binary trading methods, most of what you’re going to find are going to be products for sale. Some of these are signal services, others are eBooks. Some aren’t even methods at all, simply pages and videos telling you how easy it is to trade and make boatloads of money without any effort, and then a link to sign up on some broker’s website. Many broker sites include limited educational resources, including pages that talk about different types of analysis, but these pages cover only the most basic information; they’re introductions, not actual trading methods. You can’t effectively trade anything after you read them. They can point you in the direction of what you should be learning more about, but that’s all they can do.
Forex Trading Communities Are Better Established
The reason there are so many scams for binary options at this time is probably because it’s the new trendy thing and there are a lot of people who are going to jump into it without thinking. The Forex trading community on the other hand is much richer and better established, so you can actually find more relevant trading resources in FX communities than you can on binary options sites!
But how does learning how to trade FX help you learn how to trade binary options? For one thing, trading currencies on binary options platforms is one of your options. So methods which help Forex traders plan their trades can easily help you plan currency trades. For another thing, many methods which work for Forex also are equally applicable to stocks, indices and futures, and you’ll notice there are tons of currency traders who also trade other assets using the same techniques they use for Forex. So methods you learn on currency trading sites may even help you to trade stocks, indices and futures at a binary options site.
How can this work? Here’s an example. You search for trading strategies on a Forex community which has thousands of free trading methods. You find a price action analysis method which was designed to work on GBP/JPY, but you realize the same method works great for other currencies and for futures and stocks too. Using this method, you search for great trade setups on a professional trading platform like MetaTrader 4. You then see if there’s a binary option available with an appropriate expiry time (use Option Builder to designate your own expiry period if it’s available on your platform), and you enter the trade.
Another benefit of interfacing with the Forex community is that you’ll probably meet some more level-headed traders. There are few things more powerful than a community of honest, well-intentioned people who share a lot of experience and determination. So don’t use the lack of good binary options resources as an excuse not to learn how to trade the right way. You can use resources developed for currency traders to succeed in binary trading.