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What are binary (digital) options?

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Modern trading has changed in comparison with previous years. Modern platforms offer trading in fixed High/Low trades. This is easier and more affordable for beginners than forex or ordinary stock exchanges. Technically, the trading process has been simplified as much as possible. Next, we will take a closer look at what modern online trading platforms are and how you can earn on them.

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What are fixed contracts?

They are trading operations with a known result. The amount of profit and loss is fixed and negotiated at the time of purchase of the contract. For example, when buying a $10 contract for an increase with a yield of 85%, the trader will either end up with a profit of $8.50 or a loss equal to the value of the trade ($10).

A distinctive feature of High/Low contracts is that they are not tied to the intensity of price fluctuations. If, for example, the line on the chart deviates in the right direction by just 1 point, the trade will still close with 85% profit. In the case of more pronounced movement (100-200 or more points), the result would be the same.

This is the main difference between fixed High/Low contracts and classic trades on the stock exchange, including forex. Standard trading operations on the exchange are closely tied to market volatility. The earnings on an operation directly depend on the intensity of price fluctuations. Therefore, traders used to need to make calculations to predict the intensity of upcoming trend movement. Now they just need to indicate the direction – an increase or a decrease. Modern platforms for online trading have become simpler and more accessible than before.

How to earn on trading?

The trader opens the chart of the asset of interest (for example, EUR/USD). Then they add to it indicators or chart figures to help them recognize the cyclical patterns of the market. After a reversal signal is formed, they open an “Up” or “Down” trade, depending on the forecast. If the signal was correct, then a profit in the amount of 70 to 89 percent is credited to their account.

What are binary (digital) options?

To an outsider, it looks quite simple. The relative complexity lies in another aspect: effective market forecasting. Beginners are aided in this by ready-made strategies with step-by-step trading instructions.

More info about option broker - Binomo

5 steps for a novice trader

  1. Choosing a trading platform. This is a crucial step for every beginner. It is important not to get involved with a fraudster, of whom there are many on the internet. Therefore, when choosing one, you should put your trust in an established source rather than some spam email you’ve received. For our part, we recommend the Binomo trading platform to all beginners. They are a time-tested company operating worldwide.
  2. Trading on the demo account. You should take your first steps on the demo account before investing real money. You need to at least learn the terminal interface first.
  3. Mastering the theory. A beginner must gain an understanding of how the market works and how profits are earned. Why the price moves and isn’t static. Basic theoretical concepts are the foundation for further development.
  4. Practice. You need to start practicing how to trade with technical analysis techniques. Indicators and chart tools make it relatively simple to effectively predict market behavior. There are clear action plans that you just need to learn and, most importantly, understand.
  5. Transition to the real account. After gaining enough confidence and being successful on the demo account, you can move to the real market. In the beginning, you should trade on ready-made strategies, strictly following all the instructions and rules. With practice, your personal experience will serve as a solid foundation for developing your own trading systems.

Conclusion

Modern traders earn the same way exchange players did 100 or 200 years ago. The principles remain the same. However, modern technology has significantly simplified this process from a technical standpoint. Now online trading is available to any internet user. And to earn successfully on the stock exchange, you do not need a degree in economics or several millions of dollars in capital. You just need to have an interest in this topic and at the very least a small reserve of dedication to acquire the basic skills of independent market analysis.

You can learn to trade on your own using video tutorials, articles, books, and by practicing, including on the demo account. It is absolutely free, it just requires some time. There is a faster and easier way: training under the guidance of a personal manager on an individualized program. This way is faster, but it is only offered to premium level Binomo users. To obtain this status, you will need to make a real deposit in the system. When doing so, you won’t need to pay directly for your training.

What are binary (digital) options?

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