Prepare Yourself for Binary Options Trading!
Getting ready to trade is something that can vary widely from one trader to the next. One trader may do some yoga to calm his mind, another may sit in front of the TV with coffee and notepad writing down every little piece of news that comes across the wires. Whatever the case there are a few things that every successful trader does to get ready for the day that I think I can put down on paper. Divided into three categories these tips can be a framework for newbies or a guidepost for more experienced traders.
Long Term Preparation For Trading
Long term preparation for trading begins with education. A newbie must learn about markets mechanics, the economy, trading tools, strategies and many many other things in or risk operating blindly. A more experienced trader must stay on top of education in order to remain current. Education is the key to any successful endeavor and the foundation of binary options trading. I am always reading books and articles about trading, the economy and anything else that may have an impact on the markets in order to stay fresh and gain new perspectives. I never know when I may find that key piece of the puzzle that allows my to make a really great trade.
Picking, learning and developing strategy is another part of long term preparation. This can be included in the overall category of education but is specific enough for its own category. Strategy is how you trade the market and may include tool(s), fundamental analysis or news. Understanding how your strategy works, every nuance and signal whether bull or bear, is a great way to up the number of good signals you are able to decipher. It will also help you to avoid making newbie mistakes like trading on a false break out.
Learning and applying sound money management is another crucial portion of your long term preparation. Money management, including position sizing, dictates how large each trade is and protects your account from catastrophic loss. In a nutshell management is your best friend. It will take a lot of the worry and stress out of your trading, once you have mastered it. It took me years to fully appreciate money management but now I use it unconsciously. I trade when I see a signal with no worry of losses. This doesn’t mean I don’t have them, I just don’t have to worry about them because I know one loss, or even a losing month, will not wipe me out.
Short Term Preparation For Trading
Long and short term preparations are like yin and yang to each other, or like multiple time frame analysis on your charts. The long term sets you up for the short term. Short term preparation includes the things you may do the day or morning of your trading. For me, there are really only two things to do, not including making the actual trade.
Check The News
I always start the morning by checking the news, and with coffee of course. I wake up, turn on the TV and start with CNBC business news and then slowly make my way to the computer for more in depth and specific reports. If there is economic data being released I go to the responsible agency for the actual report, I never only read the headlines; they have too much spin. I check on the international scene to see what might affect the domestic picture then I move down to stock/index and pair specific news. I like to make notes on each as I go, it helps me to see the individual and the bigger picture as well.
Check The Charts
After checking the news, and before the markets open, I go to the charts. This is what all the other preparation is leading up to. Your long term education and experience are coupled with your strategy and short term preparations to provide you with ….. a trade or not. Checking the charts does not always mean there will be a trade but you have to check the charts to find one. I will look at a weekly and a daily chart for trend, support/resistance and indicators like MACD and stochastic to determine my signals. If a trade is present then I make one.
Other Things To Consider
There are some other things to consider when preparing to trade. First, what is your intentions with trading? Is it a game? Are you a gambler hoping to win the binary lottery or are you serious about it? This can make a big difference. If you are a gambler, or just playing around with some spare change then all the preparation in the world won’t matter so don’t bother, just have fun but don’t expect too much. For the rest of you you don’t have to devote yourself to becoming a trading monk but taking care of yourself is an important part of trading prep. Getting a good nights sleep and nourishing yourself properly are just as important as knowing how to use stochastic to measure market divergence.
Now you can really continue with College Section (: