Not all binary options strategies are complicated, with the short time period strategy being one of the simplest of all. There are two main benefits of this strategy. One would be that it requires less research and analysis. The other would be the potential to accumulate profits quickly when correct predictions are made. Both of these elements are highly desirable to both new and experienced binary options traders. It is also important to note that this strategy can be used by anyone, and is not limited to experienced traders only.
For the sake of clarity, we’ll apply the strategy to the basic High/Low trade type. However, it can be used with any trade type as it is based mainly on the expiration time and not the trade type. In order for this binary options strategy to work, the trader will need to select a time expiry period of one hour or less. Should the broker provide the option, 60 second trades could also be used in this strategy. The selection of the short expiry time simply means that the most recent asset movement will be the most important determining factor when selecting call or put.
Technical analysis should include a look at how the asset value has shifted over the past hour. Using charts, it should be easy to determine whether the movement is volatile or stable, as well as whether it is trending up or down. A quick glance at this information may quickly provide the answer of whether the put or call option should be selected. Should the movement be extremely erratic, the trader could move on to another asset, or decide to use a different type of binary options trade to profit from such movement.
Fundamental analysis should not be completed ignored when using a short term strategy. Current events could still play a role in how the value of the asset changes. However, another benefit of short term trades is that the likelihood of such an event happening is such a short period of time is not highly likely. A quick glance at market and local or world news should tell the binary options trader whether he or she is at risk of having external factors impact the value of the asset.
Using a short term binary options strategy, any underlying asset can be chosen. This will allow trader to use this strategy on the underlying asset they feel gives then the best change to profit. Even if the trader is particularly fund of a certain asset class, there should still be plenty of options within that class that can be traded on. Should one underlying asset not appear promising, simply move on to another.
The short terms binary options strategy may be basic. However, this does not stop it from being a powerful way to increase profits. The outcome of each trade will be known quickly, allowing traders to quickly evaluate their prediction skills. Those searching for a simple strategy that requires little to no testing should consider using the short term binary options strategy.