Friday, April 1, 2016

Do You Think Practicing on Trading Simulators Is a Good Use of Time? Check Out the Mess I Made Today

I've written several articles in the past about my relative distaste for e-mini trading simulators. I had a trade running on a simulator account today and proved to myself why I continue to believe that they are good for familiarizing yourself with a trading platform but relatively worthless when learning to trade. Are you a simulator warrior?
I think that just about every brokerage uses trading simulators to entice prospective clients into sampling their trading platform. With that fact in mind, usually traders have spent a good deal of time on trading simulators before they ever come in contact with me in the trading room. What is the real benefit of all this simulating trades? In my opinion, not too much.
In my trading room, I normally trade my DOM up and trade a live account. Because of some changes suggested by my trusted accountant (I really can't stand accountants when they do stuff like this), I am consolidating in number of accounts into single account at a new brokerage. Because it is a small block account, there is quite a bit of paperwork and signatures to be collected during the move; so I have been trading in a simulated account in the trading room. I had a bad experience and it reminded me why simulators don't provide the most realistic trading environment in which to participate.
It's important to realize that I was trying to trade the simulated account exactly the way I would trade my normal live account. I entered a trade that immediately began to work against me and instead of exiting the trade as I normally would, I thought I would give the trade a little time to develop. That was mistake 1.
When I entered the trade the market was flat, but fortunately I was able to spot the point when the market would break down and take a trade in the opposite direction. That was mistake 2. Of course, it was only a simulator trade; but like I said, I was trying to trade the simulator exactly the same way as I trade my live accounts. After I entered the trade the market moved to the downside and then set up for what I thought was a much larger move down. I did nothing. That was mistake 3. As the market moved against me, I was transformed from a professional trader into a blithering trading hack. I moved my stops; I never move my stops when trading a live account. I doubled down twice; I never double down when getting smeared in a trade on my live account. Those were mistakes 4, 5, and 6. Then I got distracted talking to somebody who stopped by my office and by the time I had finished I had lost $3500 of simulated money. No big deal, it's just the simulator. That is a problem.
And therein lies the rub. Because the trade had no meaning, despite my best efforts to simulate real trading conditions, my entire technique and 30 years of experience wilted under the lack of pressure. Yes you read that right; when nothing is on the line the lessons you learn seem to be superficial and seldom long lasting. On the other hand, when a mistake costs you a couple hundred bucks you tend to remember that mistake and not repeat it.
I was shocked at the relative ease I displayed in abandoning everything I knew about trading on this trade. Even though I was determined to make this fake trading as realistic as possible, my mind treated it as superfluous and I traded as if I'd never been taught the thing about trading. It was also unbelievably embarrassing, I felt like an idiot; so embarrassing that I sent a personal email to everyone in the room apologizing for my deplorable trading exhibition. I just could not get over how quickly my mindset changed when I was on this simulator compared to how sharp my mind stays trading real money. I guess at some subconscious level that is the trade has no meaning it doesn't merit my full attention. I wonder how many people battle this problem?
Would you like to start earning 300% every week? So would I... yet you see this type of hype on many sites these days. I don't promise astronomical returns, but 25 years of Wall Street trading experience has helped churn out solid e-mini traders for 5 years.

Simple Three Step Bollinger Band Strategy That Makes Money

Top professional traders all over the world use this system to trade. It works on any time frame but produces better results on the longer time frames such as daily, weekly and monthly. If used properly it can help you make money.
The first step in the system is identifying one of three specific candlestick patterns. There are over 80 Japanese candlestick patterns however, we are only interested in the strongest patterns. The strong patterns we are looking for are dark cloud cover, bearish engulfing patterns, bullish engulfing patterns and piercing lines. Each of these patterns need two candlesticks to form completely. The second candlestick is the most important and it must appear very strong.
The first thing we need is a strong candlestick pattern. A order should not be placed unless a strong candle stick pattern has formed.
The second step is the candlestick pattern must have a strong Bollinger band break out of the upper or lower bands. The first and second candle must break out of the upper or lower band strongly. If the rules are not met the trade set up should be ignored.
So the second thing we need is a very strong upper or lower Bollinger band breakout.
Rule one and two show a sign which indicates that the price wants to change. Either to collapse or advance. It only tells us that either the buyers (bulls) or the sellers (bears) are getting tired, giving up, or switching sides.
The rules also requires that the strong candle stick pattern should form were neither the bulls or the bears do not have full control over the price. This means one of the parties have become exhausted in the struggle to control the price movement.
So the third thing we need is a market showing signs of exhaustion where neither bulls or bears have full control over the price action.
If you do not have all three of these conditions it is too risky to place an order.
Using this Bollinger band system you can expect to trade five times in one month. You can set your take profit order up to ten times your stop-loss order. Your stop-loss order is best set at the previous candles high or low price.
I recommend that you practice in a demo account first. No strategy is one hundred percent right all the time. We are traders not fortune tellers. However, with proper risk management, and a solid exit plan it is possible to become consistently profitable trading currencies.
You are welcome to join our blog and community of experienced professional traders who love to mentor novice traders absolutely free of charge.

Easy Tips To Improve Your Stock Trading Profitability

As a trader you need to understand why it is that you enter a particular position, what is your own specific reason for position entry, the answer can't be "It looks like it's going up". You can't put down money based on a gut feeling; you have to be motivated by a technical reason found in the chart that you are observing. Another factor that will influence your trading is volume. The average daily volume of a stock that you choose to trade should be at minimum 1M shares. Be very cautious when risking your equity, make sure you have spent sufficient time paper trading, otherwise you will pay a lot of money in market tuition... and that can be quite costly.
Something else that will have to be considered is your personal workstation. Keep your work area clean, and uncluttered. A messy desktop will not allow you to think clearly, and will prove to be distracting. You will need a good monitor setup (2-3 monitors minimum) so that you have ample real estate to view charts, level 2, etc. You will also require high-speed Internet connection and a good direct access broker. This is a serious profession based on mathematics and market psychology, so act professional. If you trade with a budget day trading casino mentality, you will quickly gamble away your entire account.
A Few Words About Charts
It took me a few months of experimenting to find my personal g-spot for my own personal chart setup. I'm going to offer up some tips on how you can best manage your own charting.
  1. Keep it simple, and uncluttered. Have only the essential information displayed because you will spend a lot of time just waiting for a healthy setup to present itself. If you have a complex window to look at with a lot of flashing colours and numbers, you will only get eyestrain.

  2. To reiterate on the first point, don't have too many technical indicators on your charts, especially indicators that conflict signals.

  3. Have at least one broad market chart and one sector chart, are they making new highs today compared to yesterday? It is important to gauge the market relative to the previous trading day's range.

  4. Have a time and sales window for your stock, is there a buy or sell pressure?
When reading your Level 2 window use it primarily for order routing only. You can't always base a trading decision on what information you see there, because there is a lot of bluffing and intentional manipulation that happens in Level 2. You need to focus on the big picture of the market first and foremost, is it a red or green day? Is it a volatile day or is it very choppy with deadly whipsaw like activity? After you have performed this initial diagnosis, then you can use the individual chart patterns to identify a profitable entry and exit point. A common beginner mistake is just jumping in and out whenever and where ever-an entry and exit point must be determined BEFORE you place the trade.

Fibonacci Numbers for Traders, Rabbits and Other Animals, Small and Large

The legend, probably true, has it that Fibonacci came up with his numbers while observing how the population of rabbits grows due to their breeding. Even though this was centuries ago, I have this uneasy feeling that rabbits still don't get it. And I am quite sure that most traders don't get it either.
I have expressed my strong opinion, somewhat negative, about using Fibonacci indicators for trading in the not so distant past. This opinion, while expressed in the context of e-mini futures, my favorite trading instrument, applies to trading other financial instruments as well, and has more to do with how these indicators are often used (if not abused) and less with the indicators themselves.
Now, what I really want to talk about in this article is how to obtain Fibonacci numbers (1, 1, 2, 3, 5, 8, 13, 34, and so on) without rabbits. First, because it only confuses them, the rabbits, and second, because you really don't need two rabbits (and of opposite sex at that) to derive Fibonacci numbers.
You only need one, meaning number 1. Instead of two numbers (say 0 and 1 or 1 and 1) that would form the beginning of the Fibonacci sequence to be obtained via the recursive formula, a(n)=a(n-1)+a(n-2). The formula in question, if applied correctly does produce all the Fibonacci numbers.
For instance, a(2)=a(1)+a(0)=1+0=1, a(3)=a(2)+a(1)=1+1=2, a(4)=a(3)+a(2)=2+1=3, etc.
How can we do this then?
Well, take 1 and add the sum of all the previous numbers, starting from 1, to it.
This sum is 1 for the first term, so the next term we obtain this way is 1+1=2. We now have two terms, 1 and 2, and we can repeat the same procedure obtaining 2+(1+2)=5, as our sum is now 1+2. And since we now have three terms, 1, 2, 5, we can use them to obtain the next term: 5+(1+2+5)=13. In the next step, we have 13+(13+5+2+1)=34.
What we are getting is 1, 2, 5, 13, 34,...
Now, if you know the Fibonacci sequence, or saw a piece of it above, you may be feeling a bit uneasy because that really does not very much resemble one.
Well, only partially so. All these numbers are Fibonacci numbers, but it is also true that these numbers are not all Fibonacci numbers, not the complete sequence of them. It's only every other number from this famous sequence.
And that's fine, because if you really want to obtain the full Fibonacci sequence, you can do this quite easily using only the numbers you have obtained so far and all those that you can continue obtaining in the way outlined above.
You simply subtract the numbers obtained, so 2-1=1 and it goes between 1 and 2, then 5-2=3 and it goes between 2 and 5, and 13-5=8 that goes, obviously, between 5 and 13.
In other words, we can obtain the entire Fibonacci sequence starting just from a single number, 1. Neat, isn't it?
But the sequence of every other Fibonacci number is even easier to obtain (no subtraction needed) starting just from 1 and hence perhaps it is even more fundamental in some way.
Incidentally, I have not seen this kind of derivation before, although I am rather familiar with the Fibonacci literature, but perhaps someone else has come up with it before me, so I will abstain from claiming any priority. Not to mention that this is, at the very best, just a piece of recreational mathematics.

What Are the Benefits of Binary Options Trading?

Even though trading binary options can present some sort of risks, it is considered as the less risky way of trading where earning high return is very fast.
Risks of Binary Options
While speaking of online trading, the trader is given the possibility to start trading with a minimum amount of money of $10 according to the trading tool chosen. The binary options risk is reduced as it gives the opportunity to the trader to invest as little as he can afford to lose. Furthermore, the brokerage platform usually clearly indicates to the traders the exact amount they have the possibility to win and the amount they will lose, prior to the investment that made. If the return or the potential loss prediction do not suit the trader, the latter will have the opportunity to change his investment to a smaller or greater amount.
Therefore, binary options trading give the opportunity to traders to evaluate the risks before they invest their money, which is a feature that other forms of financial trading do not provide. No matter how much the financial market moves, the trader will always be aware of his potential losses.
Online Trading Investment
Binary trading is becoming increasingly popular among traders all over the internet. This popularity is due to the completely different way of trading they offer. Moreover, the traders have the ability to monitor their online trading investment by trading the amount of money they want. This way of trading accepts a minimum investment of $10 per trades, making the online trades very affordable according to the trading tool chosen. Furthermore, Binary Options offer a wide range of financial assets to invest in such as Forex, commodities and stocks.
  • Forex - Which describes changes in foreign currencies such as USD, EUR and AUD
  • Commodities - Metals such as Gold and Silver, Oil and several more
  • Stocks - These are huge companies such as Google and Apple which are available in the asset list.
Fast Returns
Nowadays traders engaging on binary options platform, want to generate high profits in a relatively short period of time. Compared to other traditional financial trading methods, options trading generates a very fast return. It offers the opportunity to have a profit margin up to 85% from the initial investment made. The expiry times available on the trading platforms is relatively short depending on the trading tool chosen. For example, when using the Speed Option tool, the expiry time usually stand between thirty to three hundred seconds. On the other side, traditional trading is held for longer period of time and can go up to many years in some cases. The opportunity to trade rapidly on financial markets combined with the potential of earning high returns is one of the most attractive feature of binary options trading. If a trader succeeds to chain a few winning trades, he can make a substantial profit in less than two hours.
Is Binary Options Easy?
In order to speed up the process from the initial investment to the first trade, brokers have ensured that trading binary options are as simple as possible. Besides, there are only a few steps involved between the signing up to a platform stage and choosing the financial asset the trader will choose to invest on. Those steps also include the choice of the amount the investor wants to trade, the selection of the asset he wants to trade with and the direction he thinks the market will move by the end of the expiry time. The trader gets through all these stages in only a few clicks making binary option very easy.
Furthermore, the profit or loss the investors will encounter will depend upon the fluctuations of the value of the asset. If a trader believes the market is rising, he would place a "call." Whereas if the trader believes the market is falling, he would invest on a "put" option. In order to ensure that a "call" option is profitable, the closing price should be greater than the strike price at the expiry time. Accordingly, for a "put" to be profitable, the price must be below the strike price at the expiry time.
Trading Accessibility
As most of the trading platforms are web-based, they can be accessed everywhere without any downloads as long as the trader has an internet connection. This availability makes it easy for the traders to regularly and conveniently check their options and monitor the financial market on a 24/7 basis. Besides, as the platform offers the access to international markets, traders can constantly keep trading at any time of the day. Moreover, the web-based platforms are now available on desktop computers as well as laptops, tablets and mobile phones which increase the trading access. The mobile application is very popular and is compatible with both Android and IOS software.
Trading binary options is the new trend nowadays. This growing popularity and notoriety in some isolated cases came from the fact that it is quite simple to get embark on this adventure that it is widely available. In order to avoid being on the wrong side of the road, the trader should, first of all, make thorough research in order to choose the most reliable brokerage firm. While speaking of binary option trading, the choice of the service provider is the hardest step for two reasons. The first one is because there is a vast amount of options trading firms and the second reason is that not all of them are regulated and will respect their promise. Therefore, this crucial choice will determine the whole journey of the trader. Once this step done, it is advised whether you are and experienced trader or not to carry out some research about the financial market and to wisely use the educational tools the platform you have chosen gave to you.

5 Crucial Lessons About Successful Trading

In this short article, I'd like to summarize 5 of the most important things I've learned about successful trading, being an independent full-time trader for over 11 years and a fully automated trader for about 7 years. I find all these lessons very important and, in my opinion, no trader should ignore them on their road to success.
Lesson 1: Refined simplicity
I have to admit that I've come a long way since I began trading.
Many years ago, I started trading very simply. It was very basic and, to be honest, it didn't work well. In today´s market, you definitely need more than the usual, basic trading stuff you'll find everywhere on the internet.
Later on, over the years, I've slowly moved to a more sophisticated method of trading, full of very advanced algos, complex know-how, mathematical and really insane trading concepts.
What was the result of that?
The more complex my trading was, the more never-ending technical problems I constantly had, becoming like a snowball effect! The complexity was a nightmare and I found out that this other extreme didn't work either.
In the end, I realized that the trick to success in trading lies in refined simplicity.
Many rather basic trading concepts can still do pretty well, if you can bring something genuinely new to them. That sounds easy to do, but it's definitely the hardest part. After 11 years, I try to keep everything rather simple, but always with some refined, strong and new quality. This keeps my overall workflow manageable, but still brings up extraordinary automated trading systems with great performance.
Lesson 2: Creativity
Like it or not, trading is 40% about being technical and 60% about being creative. Honestly, to me, creativity is still 80% of my success.
What counts is the idea. It's the overall concept that gives you the edge. The more you think outside the box, the more creativity you bring to trading, the faster you'll find great systems and more efficient ways to trade them, and most importantly, the more ideas you'll bring to your risk management.
Coding is the easy part and being a good programmer and having the greatest technology still don't mean much.
I personally know many extremely talented programmers who can code just about anything, but they don't make a penny in trading. They just lack the necessary creativity to come up with out-of-the-box trading ideas and see the whole picture. They aren't able to invent new, viable and fresh trading concepts.
I'm blessed and very fortunate to be a highly creative person and, after all those years in markets, I increasingly see how important the creative part is. So, this is where I'd really like to encourage you to become as creative a trader as possible; don't be afraid of creativity as any crazy idea can become a future winner. Spend less time with all those technical "latest exciting features". Instead, devote more time to thinking up good trading concepts.
I try to create at least one new out-of-the-box idea weekly to keep myself highly competitive in the world of trading. Just let's face it: today's world is about ideas. Look at billionaires nowadays. They don't discover new factories, new products, or commodities. They come up with ideas, usually in the field of technology. Automated trading is very similar to that: you need fresh ideas - plenty of them and fairly non-stop.
Lesson 3: Patience
Everything in successful trading takes time - a lot of time. There isn't any quick-rich-scheme. It's an extremely serious business and you have to build it up step by step. Despite all the marketing hype about trading there is everywhere, with all-the-latest-is-the-greatest platforms, indicators and other highly marketed stuff, there simply is NOT a shortcut. If you want to think about trading seriously, think of it the same way as if you were building a company. It is a serious business. Yes, you can do it from the beach if you want (I personally do sometimes) or even travel a lot while doing it (as I do often), but it still has to be treated as a serious business. And it all needs a lot of patience. If you try to rush it, you are very likely to be just gambling, not building a serious way of making an income.
Trust me. I still need to be patient with everything. I have to be very patient to get my codes tweaked and work properly, to test any new trading idea deeply, to see how 99% of my system candidates don't pass my ultra-tough robustness testing, to wait weeks and sometimes even longer to recover from occasional drawdowns. It's all part of the game. The faster you become a patient person, the faster you'll be a highly successful trader!
Lesson 4: Persistence
Every successful business has its great times and its challenging times. It is the same with trading.
I've recently read an interesting article about bloggers, saying that 90% of bloggers stop blogging after the first year and end up completely forgotten. The remaining 10% persist and later on are usually very successful. The same applies to trading.
Trading is a journey in which you do need to make some painful mistakes to learn the most valuable lessons from them and never make them again. You also have to test 100 great looking ideas, to see that only one of them is really that great and makes you money.
You need persistence-a lot of it. The good part is, that as harsh as it sounds, the reward is usually worth all of it. Yes, you can make a lot of money in trading, you can have a great life and a lot of freedom to do what you want and when you want to, but it isn't for free.
If you aren't persistent, you cannot build anything.
Lesson 5: Diversification
And lastly, this is a highly important lesson that cost me a lot of money in the past.
To achieve as stable an income as possible in the automated trading, you need to diversify more than you think, using several systems, several markets, several timeframes, several trading styles. The more you diversify, the more you'll smooth the equity.
This is also why I constantly work on new strategies - to keep myself diversified to the greatest possible extend. Sky is the limit. I love thinking about new strategies and new trading ideas (I usually get the best ones while traveling and especially in Singapore) and I frequently revise my portfolio. Even if you have a very small trading account, just a few thousands USD (don't worry, I started with the same amount of money), you still need to have diversification in mind, from the very beginning. Even two trading systems are better than just one.

How to Pick an E-Mini Trading Room That Will Work for You

In recent years, I have noticed a distinct change in the way that traders are approaching a career in e-mini trading. I want to make it clear from the onset that this article contains observations that I have made and are in no way reflective of any sort of scientific research. My observations are strictly trends that have affected my personal e-mini training experiences; that being said, these observations are similar to what other trading room operators have shared with me. Fact? Fiction? You can be the judge.
Following the credit crisis in 2007-2008, there seemed to be a pressing need for many traders to focus on being able to trade independently and without any 3rd party help. As a rough estimate, I believe there were about 50 trading rooms when I started in the e-mini education field and at last count, we were approaching nearly 700 rooms for aspiring traders to choose from. By any measure, that is an exponential leap in popularity. I'm not so sure that there are more traders in the market, but there is a distinct emphasis on self-sufficiency in trading so that individuals could interpret market moves on their own training.
Trading rooms are far more sophisticated than they had been in the number of services that these modern rooms offer; good rooms are far more comprehensive than early forays into e-mini rooms. Unfortunately, the exponential growth in trading rooms has brought a number of unsavory characters into the business and trading forums are loaded with trading room experiences that were sub-par or worse. It has now become very important to make a thorough analysis of a room before diving into the fray.
In my opinion, I would consider the following factors when choosing a potential trading home (i.e.-a trading room that is intellectually satisfying and the emotionally gratifying) here are some factors that I would take into consideration in your search for a well-rounded room:
· How long has the trading room been in business?
· Does the lead futures trader trade a style that is a good fit for your personal trading style?
· Are the trading calls in the room made early enough so that you can duplicate the trades?
· Can the trading room operator produce a verifiable track record that would include irrefutable documentation of his/her trades; for example, redacted brokerage statements, third-party verification of your trading, videos of each trading session that include all trades reported to potential clients, or any other method that is not easily manipulated?
· What would the trading room operator's credentials look like?
There are currently several well-regarded e-mini trading review sites and these sites have zeroed in on one particular problem; most professional rooms are unable to produce verified trades to establish a track record of any length. Again, I would press any room operator to produce these types of materials as most reputable individuals in the trading business have begun meticulously documenting each session and each trade. I realize that documentation can often be manipulated, but honest operators should have no trouble producing some sort of verification that satisfies you. Stay away from rooms that promise fantastic returns, e-mini trading is not a get rich quick business and anyone who indicates otherwise is probably not a good choice.
In summary, before spending your hard-earned money on a room make sure that you do your homework regarding that room and are satisfied that the trader can make money and prove that he/she has made money in the past. As always, best of luck in your trading endeavors; this business should be fun and financially rewarding.

A Simple Guide To Short Term Trade

A day trader does not invest funds or stocks over a significant period of time, but trades within a 24 hour period and starts the process at the beginning of the next day. It differs from other types of investments where assets are held for months to years to yield a return. Learning about the pros and cons of this strategy can assist in making informed financial decisions.
The day trade can prove most beneficial with research into its methodologies, procedure and an awareness of the risk involved. Short term trading has been viewed favorably because significant changes in company and economic conditions are less likely to occur overnight providing a small sense of security. The limitation is getting too comfortable and failing to recognize time to take action to minimize major losses in unpredictable economic conditions.
All processes and trading must occur within a 24 hour period or the deal is closed and a missed opportunity result in the loss of financial gain. This requires the ability to make assessments quickly and to base a decision on available information that will provide a smart and valuable outcome. It is important to determine whether the fast pace of trading is suitable for your personality and whether you are able to maintain an objective strategy.
The highly stressful and pressure filled trade requires efficient responses based on the available data and current market trends. There is no time to wait for particular positions to improve and the methods that are used with regular trades will not suffice for a short term security. Most of the profits that are generated in such procedure will be small in comparison to long term trade positions.
Professional traders work under high pressure on a daily basis remaining aware of changes in markets and movements that occur within a 24 hour period. The process requires continuous analysis and comparisons of trends or patterns to determine the appropriate time to sell. These measures are only recommended for individuals who are quick to adapt to markets, can make decisions under stress and avoid getting emotions into the trade techniques.
A benefit of closing stocks on a daily basis is minimal disruptions that can affect prices and value. Fast choices and information must be made available for day trading to sell stocks at the right time for small returns and minimal losses. It is important to recognize that profits are accumulated gradually and does not involve a major return on investment as with longer term stocks.

Learn Using Indicators the Right Way in Binary Options Trading

When traders learn using indicators the right way, it can prove to be a valuable tool to make money in the binary options market. There are many types of indicators available in the market and the parameters they measure are momentum, volatility, trend and volume. You can use one or more indicators to measure a single parameter.
Trend indicators and oscillators
Trend indicators can be used to spot reversals of the trend or can be used to spot support and resistance. Oscillator indicators move around a specific level or move between upper and lower level. Traders make use of these technical indicators to determine whether the market is overbought or oversold. This can enable the trader to get a good signal when the divergence is drawn between the price action and the oscillator.
The popular trend indicators include:
  • Bollinger bands,
  • channel,
  • Ichimoku Kinko Hyo,
  • moving average and
  • parabolic SAR.
Popular oscillator indicators include:
  • MACD (moving average convergence divergence),
  • momentum,
  • RSI (relative strength index),
  • RVI (relative vigor index) and
  • stochastic oscillator.
Mistakes to avoid in using technical indicators
One of the biggest mistakes that traders make when they are using technical indicators to trade is that they use too many of them and this can be confusing. Each technical indicator gives specific trading signal.
If for example the trader uses four trading indicators they can get four different trading signals. If these different signals do not appear at the same time it can lead to a lot of confusion and the trader many make wrong entry points. This can result in loss making trades.
The other big mistake that traders need to avoid is using many indicators from the same category. If you have 3 - 4 trend indicators giving the same trading signal it does not mean that the trade will definitely be profitable. It is important to learn about the specifications of each indicator to be able to trade successfully with them.
Most successful traders tend to combine technical indicators with fundamental, sentimental and news indicators to get a broader picture of the market. This enables them to enhance the results and increases the potential to make profits.
One the downside if you use more indicators you may become confused with the large volume of information. It can also become difficult to monitor the signals in an effective manner.
When you learn using indicators the right way, you may be able to save a lot of time and effort in understanding the price momentum of the underlying asset.
Most traders tend to get overwhelmed with too much of information and clever use of indicators can help avoid this scenario. It is best to make use of them to measure various aspects of the trade so that you are able to make profits consistently.

Binary Options Trading With Support and Resistance Levels

Trading with support and resistance levels refer to price level on charts. These levels usually act as barriers and prevent the price of an underlying asset that is traded to be pushed in a certain direction.
You may be able to see them directly on the charts and this can help you place stop loss or book profits or see the movement of the market easily.
After the market hits a support or resistance level, three things are most likely to happen and these include a change in the direction of the market, stall or retrace.
When you know how to draw these levels, you may be able to make changes to your trading strategy easily. You can make use of the information to decide when to trade, when to move a stop loss or close a trade.
Learn support and resistance levels
Although most traders think it is difficult to draw support and resistance levels, you may be surprised to know that it is actually quite easy and you may be able it learn perfectly after a few practice sessions.
One thing that you need to remember is that you should avoid drawing too many levels on the charts. You may make the entire process of reading a chart complicated when you draw too many levels.
When you learn how to draw support and resistance levels in real time charts, you may be able to plan for the day or week easily. This can help you take important investment decisions in such a way that you may be able to maximize your profits and minimize your risks.
best trading forex guide

Basic concepts of support and resistance levels
  • Remember that is not necessary to draw every level that you find on the charts. Most traders tend to draw at every price level and this can take a lot of time and effort. It is advisable to draw only the significant levels on the chart instead of messing up the entire chart.

  • The other thing that you need to remember is that you do not have to draw the level exactly at the high or low of the bar.

  • It is also not necessary that you really go back in time to draw these levels on the chart. It is best to focus on a three-month period and draw the support and resistance levels instead of trying to go back several months.

  • You may be able to determine the best time to enter and exit the market when you make use of technical analysis for trading.

  • This can help you minimize the risks of trading and you may be able to make regular returns on your investments.
Trading with support and resistance levels can help identify price reversals in the binary options market before you place a trade