In the busy world of trading, sometimes the best strategy that you can use is to take a deep breath and slow yourself down. We’ve all been in those tense situations where we are monitoring three different currency pairs just waiting for the right moment to pull the trigger on a trade. Sometimes this is a part of trading, but it shouldn’t be a constant part. The moments of chaos should be few and far between. Our argument is that by knowing exactly what you are looking for before you begin—through having a solid strategy, a firm knowledge of the asset in question, and by simplifying your trading as much as possible—the trading day doesn’t need to be hectic at all. It can be structured and quite fun, in fact.
We know that some decisions need to be made quickly. If you trade 60 second binary options, you need to be able to make very quick decisions and be extremely confident that they will be the right ones. This is why having a good deal of preparation is an absolute must. You should be able to know what signals will trigger a trade reaction from you like it was a second nature to you. By spending your time preparing and knowing what you are looking for, much of the rush and hurry of your trading day is eliminated. This doesn’t mean that you won’t be sitting down working; you will still be doing this. It just won’t be as rushed. You will be able to go at your pace, and eliminate many of the user errors that emerge from not having enough data on your side before you execute a trade.
The best way to illustrate this is with an example. Let’s say that you typically make 20 trades a day at $50 each, with an average rate of return of 74 percent. If you are correct 60 percent of the time, you are creating a profit of $94 per day. Trading is never this simplistic, but let’s just assume that over a period of months, this is what you end up seeing. Now, what if you were to step back from your trading and really study charts and spend some time finding the best broker and really maximizing your potential per trade. If you were to make fewer trades per day, we’ll say 10, and you are risking the same amount per trade at $50, your amount of risk per day would go from $1,000 to $500. It’s cut in half. Now, thanks to spending more time researching charts, finding strong technical indicators to work from, and finding the optimal binary options broker, you are seeing your success rate climb from 65 percent to 70 percent and you are earning a return of 80 percent per trade, your amount earned per day climbs from $94 up to $130.
That is a huge improvement. You are making fewer trades, but getting 6 percent more in returns per trade and trading with 10 percent better accuracy. And because you’re making fewer trades, your level of risk drops significantly. This is perhaps an extreme example, but it is a clear case for stepping back and rethinking your trading and not just going about it blindly for the sake of making as many trades as possible. A strong and well thought out strategy will alleviate the chaos from your trading day and help you to refine your profit rates. It’s still going to be a lot of work, but it is a much smarter type of work. Once you achieve this, you may want to look into automating parts of your trading. This can take even more of the chaos away.