Use Your Demo Account
It’s most likely that your broker has provided you with some sort of a demo account. Binary Options demo accounts allow you to practice trading on your broker’s platform without risking any of your own money. If you are uncertain about whether a demo account is available to you then contact your broker and ask. Many brokers now do not automatically give their traders demo accounts until they are requested. Sometimes these demo accounts have time limits placed on them so find out how long yours will be valid for and get practicing. Now of course demo account practice isn’t going to make you into a star trader overnight but it will help you get to grips with the platform you are trading on. It will also help you get the hang of the available features as well as how to navigate the trades that are available to you and place them in a timely fashion (this will be increasingly more important when trading live as a few seconds here or there can really make a difference to a binary trader).
Place Small Trades
When you first start trading with your own hard-earned money keep things small, use your first 10-20 trades to extend the practice you clocked in on your demo account. This means trade small and trade often. Doing so will help you determine your success rate, your preferred assets (stick to 1-2 at the beginning), as well as the most profitable areas of your brokers platform for you. Placing lots of smaller trades helps you gradually make the leap from trading with fake money to trading with your own capital. It may not sound like a big deal but there is a psychological advantage when trading on a demo account that often leads traders to believe they are better than they actually are. Use these first 10-20 trades to get a truer picture of how sharp your trading game is and to shake off those newbie jitters. After taking this step you’ll be in a much better position to start developing your own risk management style.
Start Using a Charting Platform.
The asset price charts that come with most binary trading platforms tend to be pretty basic. As with everything in life knowledge is power, so the more resolution you can get, the more control you have over the durations of each interval (each candlestick on a chart can be set to represent from 1 minute’s trading activity all the way up to 1 month) the greater the chance you have of spotting something that other traders haven’t. After you have gotten to know your broker’s platform and determined your success rate we recommend that you get register with a free charting platform. This will provide you with a live graph of the rising and falling prices of the assets you wish to trade. Have this platform open in a separate window charting the asset you are currently trading on your broker’s platform. Your practice on the demo account and the 10-20 small trades you started with should make it easy for you to now switch your attention between your broker’s platform and the chart, finding potentially profitable entry points and then opening up positions that expire in-the-money.
We recommend the following free charting platform:
Google Finance: www.google.com/finance
George Milios is the founder of onlineforextrading.net, the binary options and forex news portal which is dedicated to providing you with all the information you need to successfully trade.