How to Become Good Option Trader?

When we want to trade in options or stock trading then what will matter is, how you stay in touch with the financial markets. I just want to know what are the perfect options to shine in binary options trading?


  • OkaneOkane Posts: 659 mod
  • markbaxtermarkbaxter Posts: 45
    How to become good trader? With studying and trading!
  • recoldsrecolds Posts: 1
    I am new to it too, so I'd like to get some tips from you, guys ;)
  • OkaneOkane Posts: 659 mod
    recolds said:

    I am new to it too, so I'd like to get some tips from you, guys ;)

    welcome. We have many guides and blogs. For example start with the binary options guides here
  • keithriverakeithrivera Posts: 6

    How to become good trader? With studying and trading!

    Hello Mark,

    Thanks for showing your interest. I would like to say that here I am talking with respect to trading. If you have any experience or tips then please share with us.
  • BrucepowellBrucepowell Posts: 6

    How to become good trader? With studying and trading!

    Mark, you can share your thought as you want. You can share your thought regarding trading as well as study.

  • keithriverakeithrivera Posts: 6
    edited December 2016
    Okane said:

    recolds said:

    I am new to it too, so I'd like to get some tips from you, guys ;)

    welcome. We have many guides and blogs. For example start with the binary options guides here
    Thanks Okane for sharing the guide :)
  • BrucepowellBrucepowell Posts: 6
    Okane said:

    recolds said:

    I am new to it too, so I'd like to get some tips from you, guys ;)

    welcome. We have many guides and blogs. For example start with the binary options guides here
    Thanks Okane for showing your interest and share your thought with us. :)
  • bsbZenbsbZen Posts: 45
    Hello guys,

    You could have a look at our website too, as we offering a one week free-trial for binary option beginners. It is an online course that helps you step by step to become a succesfull trader. It is important to first built some knowledge and practising a lot on demo before you entering the market :smile: .

  • BrucepowellBrucepowell Posts: 6
    bsbZen said:

    Hello guys,

    You could have a look at our website too, as we offering a one week free-trial for binary option beginners. It is an online course that helps you step by step to become a succesfull trader. It is important to first built some knowledge and practising a lot on demo before you entering the market :smile: .

    Thanks a lot :)
  • crowdedbraincrowdedbrain Posts: 13

    When we want to trade in options or stock trading then what will matter is, how you stay in touch with the financial markets. I just want to know what are the perfect options to shine in binary options trading?

    I think this or any other forum about binary options is an answer to your question...
    did you forget to take your meds?
  • GihonGihon Posts: 27
    beyond said:

    there are plenty of excellent books written on the subject to help traders understand the options markets and learn to trade them profitably.

    Would you mind naming a few of them pls?
    Thanks a lot in advance.
  • The_Geek_MHThe_Geek_MH Posts: 351 mod
    Gihon said:

    beyond said:

    there are plenty of excellent books written on the subject to help traders understand the options markets and learn to trade them profitably.

    Would you mind naming a few of them pls?
    Thanks a lot in advance.
    trading for a living, reminscences of a stock market operator, candlestick signals, technical analysis explained, trading in the zone
  • ShaunRShaunR Posts: 56
    Hi new Binary Options Traders

    I would like to share a few pointers I have learned along the way in my trading journey. I am going to make several posts over time and not dump too much here all at once.

    The following is not earth shattering advice, and it really is common sense, but for those starting out, I think it useful to make mention of a few things.

    How do you become a successful Binary Options Trader?

    One - Set yourself up for success. I mean try as far as you can to put the odds of success in your favour.

    * Find a reputable Binary Options Broker that pays you the highest %return per trade. Don't settle for a broker who pays 75% ITM when you could get 90%, or higher, from another broker for doing the exact same thing. You might not think this is a major issue but it is, for 2 reasons.

    Let me quickly explain:

    Broker A offers 75% payout for winning trades
    Broker B offers 90% payout for the same.

    Let's assume you trade $100 per entry for trades with both brokers.

    Here is the issue:

    Broker A

    If I lose a trade I lose $100
    If I win a trade I get back my original $100 plus my payout ($100 * 75%) = $75

    So for every 10 trades I make, how many winners must I make to simply ensure I don't reduce the capital in my account?


    Answer... nearly 60% of your trades must be winners just to hold your account balance positive. So realistically you need a trading edge that gives you at least a 70% win rate to make money with Broker A otherwise, you put yourself at too much risk of losing money over time.

    Now for Broker B


    Just over half your trades (53%) must be winners in order to keep your capital intact.

    So clearly the payout % is key!

    But check this out too...

    Assume you do have a trading system that gives you a 70% edge (you get 7 winners from every 10 trades you make) on average.

    Let's assume you make 10 trades a day over a month (20 days) = 200 trades and we trade $100 per entry.

    Back to Broker A - what profit could you expect at the end of the month?


    while if we were to use the services of Broker B:


    We would make an additional $2100 (extra 47% more profit) at this broker for doing the exact same thing!

    So before you begin - please set yourself up for success and put the odds in your favour as far as possible.

    My next post will relate to my overall trading philosophy and it has really helped me become a consistent and profitable trader.

    If you have questions please feel free to ask.

  • ShaunRShaunR Posts: 56
    How do you become a successful Binary Options Trader?

    Two - Trading Philosophy - Your perspective has a major impact on the way you trade - well, I found that to be very true for me.

    When I first started out I would chase the market - too often making premature entries and often getting burnt as a result. I had an underlying belief that I HAD to trade because if I didn't I wouldn't get rich. This mindset resulted in my account going through major swings, boom, and bust, several times.

    I would go through phases of making profits and my account capital would grow nicely. Then, without warning, I would self-sabotage and I would lose all my hard earned profits. I would beat myself up and pull myself together and start again... this cycle would keep repeating itself - over and over.

    A wise man once asked... "What's the definition of madness?"

    The answer is obvious "Doing the same thing every day, the same way, yet expecting a different result"

    I realised that I was mad and decided to do something different about my trading approach.

    Before I elaborate further, it is relevant to explain that I trade Binary Options off the EUR/USD 1-minute chart and my trading philosophy below relates to this. However, it applies equally to any market and any timeframe, not just the 1-minute chart.

    Since I adopted this philosophy, I find I am a lot calmer about trading and I sit on my hands, waiting for a GOOD setup before I pull the trigger. The previous boom-bust cycles have gone and my account is now growing quietly and steadily.

    Here it is....

    Trading Philosophy

    Set up your mindset for success.

    Treat Trading as if you are a hunter. Why do that? Because early Homo sapiens were hunter/gatherers. We are wired to hunt - part of our early brain wiring.

    Back then, prey was typically faster and agiler than man - not easy to chase down. Still is the case today. Also, chasing animals wasted a lot of energy - man could not afford that too often.

    The best way to hunt was to form a trap and wait patiently for the prey to get caught.

    Early man required ingenuity and skill to utilise the available resources to engineer an effective animal trap. Treat trading in exactly the same way… learn to use indicators that offer an edge, set a trap and wait… and wait. There are a plethora of indicators out there in the public domain. If you use them in the manner that everyone does, you will have zero advantage over other traders. Get creative and use indicators differently to create that edge over other traders in the market.

    Hunters that would try and chase down prey quickly discovered that they were using up too much energy and either gave up or starved to death. Translation - Don't try and chase the market - your trading capital will get hurt badly, eventually resulting in you blowing your account!

    Treat your trading it as if you are looking for a daily catch of 5 to 8 small animals to feed the family.
    The forest is abundant - full of animals for you to catch. There are 60 animals per hour that run through the forest. Translation - trading the 1 min chart, there are 60 candles that form every hour. Each candle may offer a potential trade.

    If we trade the 1 min chart… between 8 am and 8 pm there are 12 hours * 60 minutes = 720 potential opportunities. That is a BIG number of opportunities. With that many opportunities, you can afford to be patient and wait for the RIGHT setups to catch your quota of animals every day.

    Don't get greedy. Don't over trade. It will hurt you.

    Another aspect of hunting is this… sometimes the trapped animal gets away. It damages the trap and escapes. That's just how it is. When the trap breaks, the hunter uses energy and resources to repair it. In the same way, we lose capital for each trade that expires OTM. It is virtually impossible for the trap not to be damaged by animals trying to escape. Trapped animals will do whatever they can to get free. It is the nature of the process.

    In the same way, making some losses in trading is inevitable - it is the nature of the process. You must get used to this concept and not be emotional about it. I don't know the outcome of each trade I take, it could win or lose and I deal with this just fine by also knowing that overall I win more trades than I lose.

    As a rule, don't try and set traps for extremely large animals - they will almost always break the trap and escape. Translation - don't try and enter on the close of an unusually tall candle just formed, there is a distinct possibility that market will retrace in the next candle, moving against your entry and close OTM.

    Finally, if a trapped animal breaks free and escapes, don't try and seek revenge by chasing the very next animal that appears from the forest. All that will happen is you will waste a lot of energy running after a more agile creature and you will lose. Revenge trading is such a waste, you damage your psychology and trading account balance all at the same time! The better option is to quietly set the trap again and wait for the next animal.... wait and wait.

    My next post will be around some simple money management rules and that nasty Martingale strategy thing...

  • ShaunRShaunR Posts: 56
    Hello beginner traders

    I will continue with the things that I consider important when wanting to become a profitable Binary Options trader. The posts I make here are in no particular order and have all contributed to my ongoing success.

    If anything you read here makes sense to you then please feel free to use it.

    So back to the question... How do you become a successful Binary Options Trader?

    Three - Effective Capital Management

    This is a CRITICAL part of becoming a successful trader.

    For me rule 1 in trading is protect your capital.

    Rule 2 is - refer to rule 1.

    I don't know about you but I worked hard for my capital and the worst thing you can do to your account balance is risk too much money per trade as a percentage of the whole amount.

    Let's say you fund your account with an initial $1000 and decide to risk $100 per trade. In the worst case scenario, you stand to lose all your capital very quickly because you only get 10 trades (assume you lose each trade).

    Take a look at the implications of this below:


    Notice what percentage of your remaining capital is risked per trade as the process continues?

    As the capital erodes it is more and more difficult to just get back to the original $1000 deposited, let alone make any profit!

    Also, as your trading capital dwindles so the pressure on you to make profitable trades starts to mount very quickly. This has a major negative effect on your psychology, as the twin emotions of greed and fear start to take their toll. You will find yourself doubting your entry signals and become too fearful to enter the market when your system gives you the green light to hit that button. Or, you may enter the market prematurely and try to force a trade only to realise once you are in the trade that you read the chart the wrong way and now you watch the trade close OTM.

    Either way, you start beating yourself up and doubt starts to creep in. Not good!

    If you are just starting out it is highly likely that your trading system is still a work in progress and the chance of you making less than 60% winners is high. Therefore it is only a matter of time before you blow your account if the % capital risked per trade is too high. I have been there and done that with Forex, and fortunately learnt my lessons, so have not blown my Binary Options account, and won't.

    When it comes to managing capital here is what I do..

    I risk 1% (or less of my capital) per trade. Why?

    1. I can afford to have 10 trades go against me and I still have 90% of my capital left.
    2. Risking 1% or less of my capital per trade takes all the pressure off to make a winning trade. If the trade ends OTM it is not a big deal and I just wait for the next proper setup. In other words, this approach takes away the psychological pressure - very important!

    Markets are places where buyers and sellers congregate, with the movement of price essentially a reflection of human emotions (fear and greed). Every second of every day these buyers and sellers decide if they should buy, sell or hold their assets, and this continuous interaction (with new information coming into the market) translates into repeatable patterns on the price chart.

    The human mind is an incredibly powerful piece of technology and has the ability to recognise and learn patterns. It is my belief that if you watch the market over a prolonged time period, and make enough trades, eventually your subconscious mind will start to pick up the underlying patterns of price movement and this will be to your advantage in a big way. In my case things started to really click after I had done between 2500 and 3000 trades. I think this is an important distinction.

    When I started out with my live account I traded 0.25% per entry and this approach has allowed me to go through the tough learning curve and survive. Now that I have done so, my account capital is growing steadily. The accumulation of profit in the trading account is accelerated, even at 1% of capital per trade. Here's why:


    As your capital grows, so the actual money risked per trade grows at 1%. If you just keep at it, you will get to the point where your trade size is $1000 per trade as 1% of capital. Assuming you have a trading system that gives you 6 wins out of every 10 made, this equates to around $16000 a month profit. BUT, you would need $100 000 capital in your account to do that.

    This is NOT a get rich quick scheme as you can see.

    Now that I have explained my money management approach, my next post will be about the Martingale strategy and trading Binary Options.

  • jamesnjamesn Posts: 27
    Thanks Shawn for sharing. I will add a bit that has also contributed to my success in binary option trading

    The difference between trading Binary Options successfully and losing all your money is not so much the trading strategy you follow but your money management. This article will explain you what money management is, and how you can find a good money management strategy for you.

    Why use a money management strategy?

    Depending on which strategy you apply to Binary Options and how well you apply it, you will win a certain percentage of your trades. For example, let’s assume that you have traded a strategy for some time, and have won 70% percent of your trades with it. This means, if you apply this strategy for 100 trades, you can expect to win 70 trades with it. On the other hand, though, this means you will also lose 30 of your trades. Some of these losses will come in a row. It is only a matter of time until you will lose as much as 10, 15, or 20 trades in row, even if you apply your trading strategy perfectly.

    Long droughts like this are the main reason many traders fail. They don’t use a money management system, and either invest a random or a fixed amount for each trade. For example, let’s imagine a trader that opened an account with $1,000. He invests $100 per trade since this seems him a secure enough amount to allow a few losing trades.

    What happens, however, if this trader hits a losing streak after a few winning trades? His balance will soon shrink to $500 or less. He will get scared and reduce the fixed amount he invests. The process will repeat itself until he has lost all his money.

    What is a good money management strategy?

    A good money management strategy helps you to survive a losing streak. To do that, it needs to be flexible. In other words, you shouldn’t invest a random or a fixed amount per trade, but a fixed percentage of your starting balance.

    Money Management Strategy
    The exact percentage should depend on the risk your trading strategy holds. The riskier your strategy, the less you should invest per trade. A good rule of thumb is to divide 100 by the lost trades your strategy will create for 100 trades. For example, when you’re strategy wins you 70% of your trades, it will generate 30 losing trades for 100 trades. This means you should not bet more than 3% per trade (100% / 30 = 3.33%). If you want to be safe, you can bet even less. Of course, you can adapt the exact amount to your preferences, but this will give you a good place to start.

    Now, you might think that you will never have 30 losing trades in a row. You will, however, have 10 losing trades in a row eventually, and 20 losing trades with only a few winning trades in between. By investing only 3 percent of your money you make sure that you still have enough money left to not only survive these drawbacks, but make a quick comeback once your luck starts to turn.

    If you manage your money badly, even the best Binary Options strategy won’t help you survive these drawbacks. A good money management system is essential to secure your success.

    How to know what to expect
    To manage your money well, you need to anticipate which risks your strategy holds. As a new trader, or as a seasoned trader that is trying a new strategy, you cannot know what to expect, and therefore cannot make quality predictions.
  • GihonGihon Posts: 27

    Gihon said:

    beyond said:

    there are plenty of excellent books written on the subject to help traders understand the options markets and learn to trade them profitably.

    Would you mind naming a few of them pls?
    Thanks a lot in advance.
    trading for a living, reminscences of a stock market operator, candlestick signals, technical analysis explained, trading in the zone
    Thank you Geek!
    I love this forum more and more!
  • ShaunRShaunR Posts: 56
    Hello again beginner traders, here is my next post related to how do you become a successful Binary Options Trader?

    Three - Effective Capital Management continued... Martingale Strategy

    12 months ago, nearly to the day, in my quest to find a winning trading strategy for Binary Options, I came across a YouTube video using a Martingale strategy to win at Binary Option trading. At that point, I had already been through countless different trading templates, indicators, and strategies and had found many ways that were not successful.

    The author of the video explained how, with the use of a Martingale strategy and starting out with a $1 trade size, he was making consistent daily profits of at least $200 trading Binary Options on a 1-minute chart. As he spoke, the trading platform moved happily in the background, and he placed trade after trade which were all winners.

    In a frustrated tone, he explained he wanted to show a losing streak in order to demonstrate how easy it was to recover. Finally, there were 3 losing trades in a row and then the 4th was another winner. His trading account happily increased over the course of the 10-minute video.

    While this was all happening, the author explained that he used to work at a factory for more than 10 hours a day, for a meager wage and was unable to afford much in life. Then he quit his job and now earns a decent salary from a few hours of work a day. The screen then switched to a statement of his trading account showing regular withdrawals from his broker of between $200 - $500 per day. He then went on to explain that a friend of his had decided to join him and was now trading Binary Options using this amazing Martingale strategy from his mobile phone, while stuck in traffic.

    He advised that this is such an easy strategy and he has NEVER had to endure more than 5 losing trades in a row. He also cautioned that you must trust the system, increase the trade size accordingly after each successive loss, and trade without hesitation, no matter what size the trading amount was.

    “Open your trading account, by clicking on the link below, and you too can start living the life of your dreams with my Martingale strategy”

    Well, I was hooked! Suddenly I had a new spring in my step and my prayers would now be answered! All those long hours of searching for a profitable trading system were a thing of the past and this was my chance to make it happen!

    Fortunately, I was not born yesterday. Ever heard the saying “if something seems to be too good to be true, it probably is!”

    So I decided to try his strategy on a demo account to really satisfy if this was real.

    When I started the experiment it was exactly as he said… I was making a new trade every minute and my demo capital was slowly and steadily increasing. This was amazing! My worst run of successive losses was 4 trades and I handled that easily.

    By the end of the third day of this awesome winning process I was ready to open a live account and hit it hard, but something told me to just keep going for at least 4 weeks.

    Well, it didn't take much longer and suddenly the cracks appeared. Things were going along just fine when I encountered my first series of 6 losses in a row. I handled it easily, by increasing my trade size as per his instructions, and fortunately the next trade was a winner so my demo capital happily increased. But now I was confused as I heard his voice in my head repeat “I have never experienced more than 5 losing trades in a row”.

    Feeling a little more skeptical I continued trading. Less than an hour later I made 7 losing trades in a row and took a $350 hit on my demo account. Now I was very concerned because I had just lost more than I had made over the last 4 days. I reloaded my demo account back up to the $1000 limit and decided to start again.

    The bottom line is I blew out my account 4 times in the next three weeks! This was a sobering experience and I tried everything to prevent it from happening to no avail. I used different trade direction sequences to his original one, I filtered entries based on market momentum, and other things, but no matter what I attempted differently, I could not avoid taking 7, 8 or 9 losses in a row.

    Eventually, I decided that trading Binary Options using a Martingale strategy was just gambling and would eventually result in losing all my capital.

    Here is the key issue:

    Without a proper entry method that gives the trader an “edge” to make money, compensation is made by using an ever increasing amount of capital to cover for each previous loss and simultaneously make a profit with the next trade. Thus the trader relies on probability to give him/her the edge they seek. Sadly probability also dictates that taking 9 or 10 losing trades in a row is also possible and will eventually happen.

    Below is the trade size required per trade, based on the number of consecutive losses, to make a profit:


    So you begin the sequence by trading $1 on the first entry. If that is a loss your second entry has a trade size of $3 and so on until you get a winning result. Then you start again at $1.

    Here is a visual representation of the amount of capital put at risk based on the number of consecutive losing trades - it grows geometrically while your profit remains tiny!


    Under what circumstances would you be prepared to risk $3 746 (after 9 losing trades in a row) to make $2 profit?

    Perhaps a Martingale strategy combined with a proven trading edge may offer a way to increase your trading capital. But because you would be increasing your profits by $1 a trade, it would be necessary to trade often to make any decent money.

    My advice to new traders that might be considering using a Martingale strategy to trade Binary Options – don’t touch it! Or at least try it on a demo account for a few weeks.

    My next post will be about finding a trading edge in the market to make profits

  • Blue Sky BinaryBlue Sky Binary Posts: 111
    Hi Shaun,

    Fantastic post! It was a good read and agreed; martingale is a recipe for disaster. Systemic martingale, however, can work if used robotically on a functioning robotic algorithm as our research shows. But humans doing it is again going to lead to disaster. We use a method known as splitting, aka dollar-cost-averaging which is quite popular in the fund investing world.

    Team BSB
    Blue Sky Binary - Research, Education & Technology.
    Signal Hive - The No.1 Binary Signals Marketplace.

  • ShaunRShaunR Posts: 56
    Thank you for the feedback suppbsb.

    I have no idea what splitting is all about and must check it out sometime.

  • Blue Sky BinaryBlue Sky Binary Posts: 111
    Hi Shaun,

    In short, if you are taking a trade, say $50, instead of taking it at your desired entry, split it up. Take a $15 trade at that point and then if the price moves against you, split and take the remaining $35 at a better price. Overall your exposure to that specific trade sequence is still $50, but your average-in-price is better than wagering the entire $50 at the original price. So your odds of making profit on this increase.

    Note that if your ITM is above a certain amount and that you are quite accurate in your entries then this process can actually slow down your capital growth over time. But if you are a mere mortal and are averaging low 60%s then splitting can help in certain instances.

    Hope that helps,
    Team BSB
    Blue Sky Binary - Research, Education & Technology.
    Signal Hive - The No.1 Binary Signals Marketplace.

  • ShaunRShaunR Posts: 56
    Ah, got it. That makes sense and I have actually done this with some trades, where I have entered at a certain level then market moves against me and I take a second entry at the new price with the same expiry. Have not split 3 ways - now that's something to think about. But then again I am a mortal :smile:

    Thanks for the explanation suppbsb
  • jamesnjamesn Posts: 27
    Nice post ShaunR, I feel I should add this for the benefit of beginner trader

    Without any software or knowledge, the use of the martingale strategy in binary options trading is not profitable. If you are an inexperienced investor, you will need a reliable signal provider to help you. You can choose either a fully automated binary option robot or a signal provider that gives you suggestions, but allows you to make the final investment decision. Let’s me take you through some of the pros and cons of this strategy.

    Pros of Using Martingale in Binary Options.

    You will rarely have a losing day.If you are one of those people who, more than anything else, hates to have a losing day, using the martingale strategy might be for you. The only thing you need is to find a suitable investment, one where you think you can anticipate the short period value changes. Sixty second options are best for this, start with a small investment and double the stakes if you do not win.
    It is the most likely way to get a steady income from binary options.If you want to earn a steady income from binary options, this method is more likely than any other way to deliver it. Therefore, this is an excellent strategy for those investors for whom a steady stream of income is the most important factor.
    If you have a good market analysis based strategy, combining that with the Martingale Strategy can give you extraordinarily good results.Combining these two strategies, you can achieve an incredibly good result. The best thing about this is that you do not even need to have solid knowledge of market movements, your market strategy can be based fully on signals produced by a robot.

    Cons of Using Martingale in Binary Options

    When you lose, the losses will be bigger than usual. Even if losses are less common using this strategy, they will come at some point. Some might lose the first time, while for others it may take dozens of trades. It all depends on how lucky you are and the accuracy of the signals you are using.
    If you try to follow this strategy without a robot or investment knowledge, the results can be catastrophic.Even though I have warned many times, some still want to try the Martingale Strategy without any knowledge or software. Why do some people do this? The advantages of this strategy are so attractive that even though losses are likely, many still want to take the risk. Even if you try the Martingale strategy cold, you can still have many winning days in a row.

    When you are choosing a broker for this strategy, there are three extremely important factors that must be taken into account. First you have to be able to start with a small initial investment. Secondly you must be able to raise the investment amount if necessary. The third important factor is a good average return rate.
  • ShaunRShaunR Posts: 56
    edited January 18

    go with a broker that will give you proper trading education, webinars, 1on1 time with an analyst, signals etc.
    Please avoid quoting spammers and their links! //moderator

    I'm pleased that you found a profitable trading edge through the support of your broker, olimiller8. My experiences with brokers is a contradiction to this, unfortunately. In my experience, each broker I have been exposed to (only six) offers very rudimentary training education but that does not constitute a winning edge for clients.

  • BrucepowellBrucepowell Posts: 6
    Thanks to all for showing your interest. I am glad that you all share your opinion :smile:
  • ShaunRShaunR Posts: 56

    .... I am proud and happy to be making about $2000 a week in just a few hours, from the comfort of my home or even on my smartphone while commuting from work.

    Careful faithwilliams, you are starting to sound like that martingale strategy dude on YouTube who had a friend making money on his smartphone while stuck in traffic! :smiley: :smile:

    Seriously though, I don't think I could trade off a smartphone while commuting to/from work. I wouldn't be able to concentrate properly.
  • GihonGihon Posts: 27
    I see the martingale is keep popping up and nobody really mastered it who posted about it...
    May I add a few thoughts for everyone's benefit.
    Martingale comes up strongest in roulette strategies.
    As a professional roulette player I do not recommend using it until one truly mastered it.
    Do not approach trading with martingale until you were able to beat the roulette machine with martingale!

    I can get very good if I trade based on martingale.
    However in this case not to care about price action at all, if you do you are not using the martingale as a professional would...
    Classic Martingale on roulette:
    Bet on black with 1 unit (usd whatever)
    You win you stay on black bet 1 unit again.
    You lose you stay on black double the bet. (2 units)
    Continue until you win then start from 1 unit again.
    If red comes out 3 times in a row you call it a new trend and you continue betting on red until black comes 3 times in a row.
    If 0 comes, just ignore it and continue.
    This strategy assumes you shall not get 10 blacks or reds in a row.
    However reality is you keep playing for long enough your odds are on a rise to eventually get even 15 blacks in a row and 2 powered 15 will surely blow your bankroll or reach the table limit!
    Most people would think about Martingale in trading like this.
    Advanced Martingale for roulette on black and red:
    (also called hawk strategy)
    Bet on black 1 unit.
    Lose: stay on black double the bet.
    Lose again stay on black double the bet.
    Win: bet on red with 1 unit then continue.
    Win: bet on black with 1 unit.
    Lose: stay on red double the bet.
    Lose again, stay on red and double until you win.
    This is already a smarter application of Martingale and still not best. ;-)
    I have many better strategies then this.

    Point, Martingale on classic black and red goes as: 1,2,4,8,16,32,64,128 (this is where it starts becoming hot), 256,512,1024,2028,4056,8112,etc. At the end your profit is 1 unit always (what you start with).
    Martingale with 90% profit aiming to protect the capital and some profit:
    1,2,4,8,17,36,76,161,339, etc have you started seeing something.
    Martingale with 80%:

    So what should you do to avoid 5 or more losses in a row?
    Would hawk strategy help?
    Enter a call with 1 unit.
    Lose: enter a call again with the increased units depends on the profit ratio.
    Continue till you win then enter a put with 1 unit and start again.
    Win: enter a put with 1 unit, etc.
    Will this help you?
    No! No odds on the long run will eventually turn against you I promise you that?
    Analyzing the chart and try any prediction when want to rely on Martingale alone is making the Martingale of no affect!
    Yes! If you understand Martingale and know some real strategies you must know this.

    So what then?
    Just do this: enter a call or put with 1 unit regardless. Expires ITM enter the opposite 1 unit. Expires OTM, increase units but enter opposite!
    Win or lose always enter the opposite, this way you increased the odds. Lowest probability you go random call, put, call, put, call, put and you never get it right 5 or 10 times in a row!
    Now that is getting out the maximum of Martingale in binary trading. Do not analyze, don't even put any indicator, don't care where the price is going. You analyze, etc and not keeping the randomness the Martingale will work against you, you are turning the odds against yourself!

    So, you want Martingale, download a roulette app and practice until you master it, then come back to trade but I advise you to go live on roulette with it and be able to leave with profit before trying to trade with it.
    Martingale and roulette however will give you a psychological preparation which is greatly different from trading and can confuse you.
    So master binary trading without Martingale and make profit, leave the Martingale alone!
    Then master Martingale in roulette, be able to make profit and after this you have a chance to apply Martingale sometimes when trading but do not rely on it unless 100% random.
    Or master Martingale in roulette first then forget it for a while. Master binary trading, then you might have the way to intelligently combine them...
    I could tell you in length about Martingale, pls realize you just scratched the surface!

  • GihonGihon Posts: 27

    Gihon said:

    beyond said:

    there are plenty of excellent books written on the subject to help traders understand the options markets and learn to trade them profitably.

    Would you mind naming a few of them pls?
    Thanks a lot in advance.
    trading for a living, reminscences of a stock market operator, candlestick signals, technical analysis explained, trading in the zone
    Mr Geek,
    Which one of these books would you recommend on how to use indicators?
    Pls help me out.
    I deed not have time yet to really dig online into it, at first hand it seems as most sites that describe indicators do not give much explanations nor a practical way of how to use it for best results. Am I right or only looking at wrong places?
    Thanks in advance.
  • ShaunRShaunR Posts: 56
    Hello again beginner traders, here is my next post related to how do you become a successful Binary Options Trader?

    Four - Developing Your Own Trading Strategy

    Before getting into the specifics, I want to offer some background into the mindset I adopted in order to get there. Without it, I would have surely given up, way before I made the breakthrough. I hope that newbie traders will take something from this post to encourage them in their quest. I also hope that my suggestions might short cut the process and allow new traders, determined to make the breakthrough to finding their own trading strategy, get there faster than I did.

    Apart from trading, I am very fortunate to be the leader of a 300 employee company which continues to enjoy geometric growth over the years. I have always known that the leader of a business is the bottleneck to its growth, and being very mindful of this, I actively sought out mentors who could assist me to learn more effective ways of doing things. Over the past 10 years, I have accumulated a wealth of knowledge, from a group of outstanding human beings, that has helped me to develop personally and allowed my business to flourish.

    I took some of my business learnings into my quest of achieving my goal - > to become a successful, consistent and highly profitable Binary Options trader.

    This guy has had a major impact on my psychology.


    Tony Robbins defines the Ultimate Success Formula as the following (may not be exactly as he puts it):

    1. Know your outcome (what do you want to achieve?)
    2. Take massive action towards achieving your goal
    3. Develop sensory acuity (develop a feedback loop to establish if you are moving towards or away from the goal) - this step is most important
    4. If you are not moving in the right direction, change your approach (do something different) and repeat from step 2 until you have achieved your outcome.

    Now that formula seems so simple, and it is. Most people might understand it intellectually but they don’t apply it. Either they don’t know what they want, or they don’t develop an effective feedback loop that tells them if they are on track or not. And because they can’t tell if they are making progress they keep doing the same things, day in and day out, expecting different results. That’s a simple definition of madness by the way.

    Finally, the majority of newbie traders find the journey too hard and give up along the way.

    So I knew what I wanted -> to become a successful, consistent and highly profitable Binary Options trader. (I have a bunch of financial goals that go along with deadlines too).

    Now I needed to take massive action.

    I decided that I would concentrate on a single currency pair (EUR/USD) because this pair has the highest average payout % on the trading platform I use. (In a previous post – step one – I explained my rationale behind this).

    Each trading instrument has its own character or rhythm, and I was going to learn EUR/USD. Why try to learn a variety of instruments when my goal is simply to be a consistent and highly profitable trader – I need to trade just one market and maximise my chances to make money from it. My goal is to make money, not trade a variety of instruments.


    Peter Diamandis, with his Xponential Advantage strategy, advised that I should experiment as fast as possible (as part of the process of taking massive action) and so I decided that the fastest way to learn the dance of EUR/USD was to use the 1-minute chart. A new candle is created every minute. I can relate to that, effective trading strategies should work across any time frame and so I wanted to use the 1 min chart to learn as quickly as possible. In addition, my work is often very demanding of my time, so I wanted to find a way to work and trade whenever I had a 15/30 minute gap. Trading off the 1-minute chart would offer me this possibility.

    Don't give up - ever!

    Before taking massive action, I made a KEY distinction. I decided that I WOULD find a way, no matter how long it took, no matter what the pain, I would NEVER give up. I turned the idea of “one day I’ll be a profitable Binary Options trader” into a strong desire to achieve this. I turned a “should” into a “MUST” (Tony Robbins). I have some massive goals that I wish to achieve, with the proceeds of my trading, related to uplifting previously disadvantages communities here in South Africa.

    I drew motivation from the stories of Thomas Edison and his quest to invent the electric light bulb, Colonel Saunders and his quest to sell his fried chicken recipe (apparently rejected 1009 times before his first success)and Sylvester Stallone’s determination to become a movie star (he ran out of money and even sold his beloved dog but refused to quit). In each case, these men faced MASSIVE rejection and failure at every step, yet because they had such a strong desire to break through, eventually they did! There are many more stories just like these and my view was that if they could do it, so could I.

    OK so back to the market and what was my approach…

    Keep things simple, don’t make things complicated. So for me, the market does two things – on all time frames by the way – it either moves sideways (consolidates) or it moves in one direction (up or down) with momentum (trending).

    Here is an example of a EUR/USD chart showing periods of consolidation (sideways movement) and also trending (moving in one direction):


    The most obvious thing for me to do was wait for the market to start moving in a strong trend, wait for a pull back and then take a trade in the direction of the underlying trend. This a FAR easier for beginners to do than attempt to trade against the direction of the market.

    So how the heck can you work out when the market is in a strong move vs consolidating? Finding a way that could distinguish this was my first task. Here is a very simple way to do so:

    Use any charting package.
    Open a chart of any trading instrument, using any frame and add 3 exponential moving averages to this chart:

    5 period EMA (white line)
    8 period EMA (purple – double thickness)
    15 period EMA (sky blue – double thickness)

    These moving averages can be any colour you choose. I’ll use the colours specified above in my later explanations of how to use these lines to determine market momentum.

    You should see something like this:


    Let’s now examine how we can use this very simple template to identify when the market is in a consolidation or trending phase.

    When the three lines have no clear gap between them and are bunched together, the market is in a consolidation phase. Simple.

    When the three lines are wide apart the market is trending and a strong move is occurring. Simple.

    Ever heard the saying “the trend is your friend?” Well, it’s true – we set ourselves up for success by taking trades IN THE DIRECTION OF THE TREND. Trading this way gives us the greatest probability that price will close in our direction and we will end ITM.

    Continued in next post....
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