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Don’t make these mistakes if you want to make money

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The most common mistakes of binary options traders

Once I tried to understand what lies behind the failure of binary options traders and what helps them to succeed. I realized that the many reasons I have heard in private conversations and read online can be classified into four main categories. We'll talk about each, and try to figure out how not to make the most painful mistakes.

Excitement and self-confidence - the worst assistants

These qualities of newbies are based on general information and aren’t supported by fundamental knowledge, often resulting in losses and thereby forming a false belief: "It’s impossible to earn with binary options." To understand the binary options market, you must read some books or take a couple of lessons from experienced, successful traders.

In order not to repeat the mistakes of other traders, you should learn how to make fundamental and technical analyses of the market, learn to choose the right binary options strategy, and learn to understand the basic principles of the behavior and reactions of particular assets. Intuitive trading is like a lottery: One chance in over a million that your ticket will win.

The main mistake of all traders is to ignore studying.

Just think and analyze

When trading binary options, you shouldn’t let your emotions change the logic and calculations. During a sharp rise or fall, it is not necessary, without analyzing the situation and taking into account its further development, to immediately buy CALL/PUT options. Even when trading with a demo account, experienced traders advise treating the virtual money as real.

With this practice, you can improve your trading skills and forecasting and also psychologically prepare yourself for possible future losses and income. You’ll learn the main thing: To manage your emotions. You’ll feel the "price of money" and learn how to balance risks and returns.

Inability to control emotions is the second most common mistake among traders, for which they pay in their hard-earned money.

Lack of own trading strategies

One of the most common mistakes is to follow the crowd. "In the forum, somebody wrote that he buys CALL, so I’ll do the same." First, remember that the forums are viewed by exactly the same traders with exactly the same knowledge as you. If you don’t trust you, how can you trust others.

Moreover, the market reacts to an increase or decrease in demand with a certain inertia. When entering the market based on listening to the crowd, you can be late and get into the market just before trend reversal or when the market reacts to the news and the activity begins to fall.

Before entering the market, analyze the market and understand why you need to buy CALL or SELL. If you aren’t confident, verify your assumptions with experienced traders who have personal blogs or publish their forecasts on the broker’s website.

You must have your own personal trading strategy (plan). It will allow you to consider all possible scenarios and your reactions to them from entering the market to closing.

A trading strategy will help you eliminate the first two common trader mistakes. Moreover, when having a trading strategy, you'll know what to do after you make a profit. Without a strategy, after the first profit, traders immediately try to earn more but usually have losses.

The presence of your own trading strategy will save you from the first two mistakes, and thus increase your chances of success.

Choosing the right Broker

It would seem that there is nothing difficult in choosing a broker; there are thousands. However, your broker plays a key role in your trading. Your broker determines the assets, transactions, your deposit, trading platform, and withdrawal. Yes, that's withdrawal. To get money with options is not easy, but sometimes, it is even more difficult to withdraw your money.

Comments

Jeff Holson's picture

I agree with what you have written. It's true most new traders make these four fundamental mistakes, and thus leave the fun of trading even before starting!
You are right when you are stating that we have to study how to trade.

Several brokers websites developed an academy section whereby they provide for ebooks or videos among other educational materials. Others have excellent customer support. Expert traders are available to guide them throughout their trades.

A thorough research about the brokers is essential before signing up with any of them. Many websites offer such reviews such as www.bigoption.reviews. My advice would be to research, learn and start trading with confidence. Surely, at first it may be confusing, but with experience everything becomes possible.

Jeff Holson
restoremyhope's picture

true i have had more withdrawal issues with brokers. easy to deposit hard to withdraw.

restoremyhope

Disclaimer: The article is written for informative purposes only and it is not financial advice. The author does not have any position in the currency pairs mentioned, and no plans to initiate a position. He wrote the article himself and expressed his own opinions. He has no business nor personal relationships with any mentioned government entities or stocks. Readers should not treat any opinion expressed by the author as a specific inducement to make a particular trade or follow a particular strategy, but only as an expression of his opinion.

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