WHAT HAS CHANGED IN THE INDUSTRY OF BINARY OPTIONS TRADING OVER THE LAST FEW YEARS

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The Big Challenges Ahead for the Binary Options and Forex Industry

Who is killing the binary options industry – brokers, platform providers, regulators or affiliates?

It’s not breaking news anymore that the binary options industry is under fire. The question on many people’s minds is who is to blame for the negative stigma that has developed and what has caused the decline of this fledgling industry? The other major question on many peoples’ minds is will this trend taint the already well establish FX industry?

Every day, more and more binary options brokers are being flagged as scams and with so many brokers having to shut their doors in recent years, it’s clear that the industry needs a good shakeup to eliminate the rotten apples that have tarnished the entire binary options industry.

The Platform Providers

The industry started with a handful of innovative tech companies, that saw an opportunity to build trading platforms and to provide turnkey solutions for those who wanted to be brokers. While the intentions were good, the aggressive marketing to would-be brokers opened the door to many unscrupulous businessmen who wanted to make a quick buck, with no thought to the medium and long term sustainability. On the other hand, there were also many entrepreneurs who took the opportunity to build quality, service-oriented businesses.

Based on this, should these platform providers not have done more due diligence as to who they were offering their solutions to, or at least created a framework and monitoring mechanism to ensure that business was kept clean and ethical?

The Brokers

Now, if we turn our attention to the brokers and how they have been operating, many have done a good job of ‘keeping it clean’ but unfortunately there has been no shortage of brokers who simply went for the quick buck. What started the cancer growing in the industry, were those brokers who promised the impossible and whose sole intent was to drain every last cent from their traders. They also especially preyed on those who didn’t have the means to even start trading.

This short-sighted approach allowed for the tumor to grow and many brokers, who were trying to keep it clean, found themselves quickly losing market share and having to adopt the same shady tactics. As a result, everyone is paying the price now. So now the question is whether it’s the dubious practice of many brokers that has allowed the tumor to become fatal?

The Regulators

The next potential culprits in this mess are the regulators. Now you are probably wondering how can the regulators be to blame. Well, the first potential reason is that many brokers simply didn’t have the time, money or resources to meet the ever-changing regulatory requirements. As a result, many brokers simply rejected the idea of all this investment in regulation and those that did, in many instances, shot themselves in the foot. Why, you might ask.

Well there are so many different regulators with different requirements, but the bigger issue is they have all been somewhat reactive, in taking action only when they receive a complaint. As the old saying goes, ‘prevention is better than cure’. So, what has been the best way for a broker to avoid issues with regulators? Simply don’t get regulated and operate without it. There are many brokers now who are turning to the more established and structured gaming industry regulators, as this has been far more effective and successful than the financial regulators.

Maybe the financial regulation bodies should have formed a more cohesive and unified approach, while working closely with governments, to create a proper legal, regulatory and licensing process.

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Affiliates and Marketers

Affiliates are part of the lifeblood of traffic to brokers, but they are also to blame for the growing tumor. It is no secret that some affiliates use less than ethical marketing techniques in order to make money; from manufactured reviews and testimonials, unsubstantiated systems and bots, to promising endless riches. The other major marketing technique, that has really put a target on binary options, are the scam sites. In the purest form, these types of sites should prevent traders from being scammed. Instead, they have simply shifted the trader from one ‘dirty’ brand to another, where the affiliates are making better commissions.

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The bigger problem is that as soon as someone with very little knowledge of the industry reads the word ‘scam’, it draws attention and questions whether binary options are legit or actually a scam.

What about the FX brokers?

FX, over the years, has become an established and stable industry and has been through its pains, but all the bad publicity of binary options has now started to shift some of this negative sentiment to the FX space. The other challenge that is perpetuating the impact on the FX brokers is that many of the binary platform providers are now offering FX as part of their package, and many binary brokers, who have been running less than legit businesses, are taking advantage of this FX offering and applying their same shady tactics.

The Bottom Line

So, who is to blame and what will happen to the binary options industry? It’s clear that the four main players, platform providers, brokers, regulators and affiliates, all have their share of responsibility.

Platform providers need to realize that they cannot simply hand out their platform like candy, and they certainly must not abdicate their responsibility for good ethical business practices by passing the buck to regulators. This short-sighted approach of selling their solutions to anyone and everyone must stop and measures need to be in place to regulate, to an extent, at the provider level.

Brokers also need to step up and take a long-term view of not promising the impossible, practicing good business ethics and delivering on their promises. In a perfect world, brokers shouldn’t need regulators to tell them what is right and wrong; any reasonable, honest person can evaluate what they are doing.

Regulators also need to get their act together and work together to build a uniform approach that is sensible, logical and simple enough for brokers to implement and adhere to. The fly by night, dodgy brokers need to be taken to task and eliminated and ensure that when a brand is closed, funds are returned to traders.

The affiliates and marketers need to realize that if they don’t apply some level of moral marketing, they are going to kill the goose that lays golden eggs. There are thousands of niches out there that have grown and continue to flourish, without all the dirt, which proves that good business practices today will ensure the goose keeps laying golden eggs for a very long time.

Where to from here?

There is no time to keep finger pointing or talking in circles – all the stakeholders now need to pull together and start working together to stabilize and clean up the industry. If we don’t take action now, everyone is going to feel a lot more pain before it can get better, if at all!

New! Best Binary Options Strategy that works – Beginner Friendly

New! Best Binary Options Strategy that works – Beginner Friendly

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Last Updated: Sep 3, 2020 @ 2:02 pm

Binary Options Strategy that works

Binary options have been available to the general public since 2008, but have only gained real momentum over the past few years, with more people recently becoming aware of this unique (and possibly lucrative) trading opportunity.

Still, while many people have heard of binary options and quite a few have even tried it, it remains a mystery to many how it works and how they can take advantage of it to turn a profit. The purpose of this article is to inform those who are interested in making a profit in Binary Options how to go about doing so.

We will touch on the basics of binary options and how Binary Options work, we will then explain the different systems and strategies available and finally we will find out what the best Binary Options strategy is, or which one actually works. By the time you are finished reading this article, you should have a good working knowledge of Binary Options and a good idea of how to turn a profit.

The basics

Binary Options trading is basically speculating whether an asset will go up or down in a certain amount of time. A Binary Options trader will put his or her money on either a “Call option” or a “Put Option”. A “Call option” is a speculation that the current assets value will be higher than the opening price in a set amount of time. If the assets value is higher, then the trader wins. On the other hand, a “Put” option is the opposite, in that it is speculating the assets value will be below the opening price. The underlying asset can be a stock, a forex currency pair, a commodity or an index.

There are also a few different types of binary options. Digital Binary options are your standard up or down options. This is the most common binary option. All you are doing is deciding whether the price of the underlying asset will be higher or lower (up or down, call or put). Another type of Binary Option is Range Options (also known as Boundary Options). Range options

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Another type of Binary Option is Range Options (also known as Boundary Options). Range options allows you to predict if the underlying asset will expire in or out of a set price range. Another variety of Binary Option trading is called “Touch”. Basically, this option provides you with a price and you have to decide whether the underlying asset will hit that price during the time allotted. If it “touches” or goes past that price, then you win the option.

One of the best things about binary options is that the risk is fixed as is the return. It doesn’t matter how well the underlying asset does, if you call it, and it’s in the money, you get it. Whether it has largely surpassed all expectations or just barely made it, as long as it has expired in the positive, you get your return. The expiration time is also fixed, so the trader knows exactly when it is set to expire before he even clicks on the trade. It’s so simple and easy, anybody with a computer and a bank account can start trading and even winning right away.

Of course, even if it is that simple to trade in binary options, it’s not that simple to actually make a profit from trading. You have a 50/50 chance of guessing the results in a binary options, which isn’t really that awful bad, but you can do much better if you have a strategy going into it. Without any sort of strategy, chances are you are not really going to make much in binary options trading and you will usually be lucky just to break even.

**Hot Tip** – If you don’t want to stress yourself combining many different strategies, then consider using a trusted signal service like Signals365 which makes use of the trading strategy we explained on this page as well as other top binary options trading strategies. They really made everything interesting, simple and easy to follow!

Binary Options strategies and systems

There are many binary options strategies out there, but not all of them are successful. In order to maximize you potential return, it’s necessary to understand the different strategies, finding the best strategy, and then continuing to change and tweak your strategy as the market changes. You may have also seen some systems online that promise high yields just for signing up on their website (often free) and using their program to make money. While this might sounds pretty good on the surface, most of the time these programs and systems are nothing more than scams. The catch to most (if not all) of these systems is that they require you to use their broker, which ends up giving you less of a return and often no return at all on your investment.

Your best bet would be to steer clear of any types of programs or systems that claim to make you rich in binary options, as these are more than likely just out to get your money, not to make you money. You should, instead, concentrate on learning and developing a strategy to track and gauge trends in order to make a more educated guess on how the underlying asset is going to do. While there are many, many binary options strategies out there, most of them require you to use a price chart to gauge the activity of assets.

An important thing to remember about binary options is that there are constant fluctuations in the price of any given asset. This is especially true over short periods of time, like 15 minutes or 30 minutes. Of course the longer the period of time is, the easier it is to predict certain trends in the fluctuations, but the longer you will have to wait for your return.

Most binary options trading is done in the short term, even though it’s much harder to predict. This is because short term binary options offer an almost immediate payout, so your money is not tied up for a long period of time. Most binary broker’s payouts are not sufficient to tie up your money for a long period, and immediate payout can increase your funds much quicker. This is where a good price chart becomes an invaluable strategic tool in gauging the actions of any given asset. A good price chart can give you an accurate representation of how quickly prices might change and allow you to see how quickly future trades will materialize.

By using a price chart, you can see minute to minute movements of different assets in order to more clearly predict what the asset is likely to do in the near future. It may take a little time to get used to reading a price chart in a way that helps you to predict the outcome, but after a while you will start to learn how to see trends in the market, and by understanding and using these trends, you can accurately gauge the direction an asset is most likely to move.

Using a candlestick chart

The best type of price chart to use for gauging the movement in any given asset is called a “Candlestick Chart”. A candlestick chart will give you the most information on the performance of any given asset over a short period of time. The first thing you will need to know is how to read a candlestick chart before you can actually utilize it for predicting your assets movement. At first glance, candlestick charts might seem complicated, but in reality once you understand the basics, they are very easy to use and quite intuitive.

A candlestick chart will show you the opening, highs and lows and closing value for a set time frame of an asset. The chart is made up of vertical rectangles which are either red or green with lines on the tops and/or bottom of the rectangles. The rectangles are called the bodies and the lines are called the wicks. The wicks (also called the shadows) tell us the highs and lows where the top line define the upper value of the stock and the bottom line defines the lower value. If the asset closes higher than the opening price, then the body is shows as a hollow rectangle (usually green) with the bottom of the body representing the opening price and the top of the body representing the closing price. If, on the other hand, the asset closes at a lower value than it’s opening price, the candlestick is drawn as a filled rectangle (usually read) with the top representing the opening price and the bottom representing the closing price.

Usually, the longer the body of a candlestick the more intense the buying or selling of that asset is at that period of time. Conversely, the shorter a candlestick is, the less movement there is in the price of the asset. A long hollow candlestick shows aggressive buying and a long filled candlestick shows strong selling of any given asset. The longer the hollow candlestick is, the higher the close is above the opening, and conversely the longer the filled candlestick is, the lower the price of the closing is above the opening.

By simply studying the candlesticks over a period of time you can see patterns in the opening and closings and without any further information, you can often accurately determine the next action of the given asset. For instance, you will notice on many price charts that there will be a filled candle, hollow candle, filled candle, hollow candle, etc. If you the last option closed higher than it opened, then the probability will be that in the next period of time it will close lower than opening and you would then place a “put” option on that asset, and vice versa. This is probably one of the simplest, yet successful strategies used by Binary Option traders today.

Another thing to look at when you are reading the candlestick chart is the wicks (lines or shadows) on the candlesticks. The wicks on a candlestick shows you the actual movement during the session of buyers and sellers of any given asset. The longer wick on top and shorter wick on bottom indicates that the buyers dominated the session and bid higher prices, however sellers forced the price lower toward the end of the session and the weak close created a long upper shadow. If, on the other hand, the lower wick is longer and the top wick is shorter it shows that it was dominated by the sellers for that session, with the buyers driving the price up toward the end of the session with the strong close causing a longer lower wick.

Best Strategy for gauging binary options

By understanding candlestick charts you can use the information to accurately predict how any given asset is going to move. Of course, you can never be 100% sure on how it’s going to play out, but by understanding and using the candlestick you will increase your chances of success quite a bit.

The thing you need to remember is to not only look at the candlesticks, but also the wicks (or shadows) as well. If there is quite a wide fluctuation in the wick, it will be much more difficult to gauge than if the wicks are fairly stable. The less volatile a market is, the easier it is to predict high and low trends, so a good strategy is to look for less volatile assets, such as foreign exchanges (Forex) that tend to oscillate in a fairly predictive pattern. Once you have discovered those assets that seem the most stable, all that’s left is following the asset in real time over a certain period of time and then utilizing the trend to predict the next call or put option.

In order to predict the next option, you should look at whether the asset closed higher or lower than it opened in the latest session. Usually, in a stable market, if the asset closed higher than it opened, you would want to use a “put” option and conversely if it closed lower than it opened you want to do a “get” option. This is usually the case, but not always, which is why it’s important to track the asset to see if there are any exceptions, so that you can accurately predict how often the particular asset goes down or up, how high it usually goes before it goes down, and other such relevant information. The longer you track an asset, the more reliable you can gauge the underlying activity and the more accurately you can predict its movements.

You should keep in mind, this strategy works best when dealing with a calm market. If the market is more volatile then it’s much harder to predict what the asset might do, so sticking with the less volatile markets is key to winning, using this strategy. Also, the longer you track the assets highs and lows, the easier it is to predict the pattern and the greater chances you will be successful in your trading.

**Hot Tip** – If you don’t want to stress yourself combining many different strategies, then consider using a trusted signal service like Signals365 which makes use of the trading strategy we explained on this page as well as other top binary options trading strategies. They really made everything interesting, simple and easy to follow!

Some final things to keep in mind

Now that you understand how to use the candlestick chart to predict an assets movement at any given time you are on your way to making a profit in Binary Options trading, but there are a few things to keep in mind in order to create the most profit. One of these things, and this is a very key thing, is to check out as many brokers as possible, before settling on the best one. You should look at brokers that offer the best payouts, with the most options. There are many different brokers available and this will take some time on your part to do the research necessary in order to best decide. Some brokers will even give you a portion of your money back when you predict wrong, usually around 15%. You’ll want to check out what others are saying about particular brokers and decide for yourself which is right for you. Some other things to keep in mind when deciding on a broker is how much of an initial deposit is required and how much the minimum investment is. As a new trader, you will want to start with small investments until you see a definite trend in profits over losses.

Another thing I highly advise for new traders is to find a good broker that allows you to play the binary options without actually putting your money down first. These “practice accounts” allow you trade binary options using fake money. By using a practice account first, you can get to know and understand the options and practice using the candlestick chart before you plunk down your hard-earned cash.

You will be able to see where the best assets are, how much the best investment to make is and how often you win/lose on your trades. Once you feel comfortable and are making a profit (albeit a fake one), you can then open an account by making an initial deposit with the broker. Hopefully, by the time you actually put your real money down, you’ll be knowledgeable enough to make sound decisions, based not on guesswork or hunches, but on real, proven strategies! Just remember, even using the best strategy there is no guarantee that you will be successful every time, but by using a candlestick chart and understanding and utilizing the trends, you will definitely increase your chances of an accurate prediction by a very large percentage. Good luck and happy trading!

Hopefully, by the time you actually put your real money down, you’ll be knowledgeable enough to make sound decisions, based not on guesswork or hunches, but on real, proven strategies! Just remember, even using the best strategy there is no guarantee that you will be successful every time, but by using a candlestick chart and understanding and utilizing the trends, you will definitely increase your chances of an accurate prediction by a very large percentage. Good luck and happy trading!

The problem with binary options trading!

A fair bit of spotlight/scrutiny has been placed on binary options in the past years, with warnings issued from central banks such as the MAS (MAS-Cautions-Investors-on-Risks-in-Trading-Binary-Options-with-Unregulated-Platforms, SEC warns against Binary Options and scams such as the-wolves-of-tel-aviv-israels-exposed.

Likewise, we hope to take this chance to educate investors on this highly risky investment product and advise everyone to think twice before hopping on this bandwagon.

What are Binary Options?

For those who might have chanced upon a Binary trading advert or some sort of get rich scheme, you might be familiar with the below:

Trading with Binary options is to predict whether a stock, or an index, or a commodity or a forex pair, would go up or down within a certain time frame.

Binary options “are based on a simple ‘yes’ or ‘no’ proposition: Will an underlying asset be above a certain price at a certain time?

Correct, you are NOT actually buying anything, you don’t wait for something to go up and sell at a profit, not at all. You invest in putting down an option that, for example OIL, will have increased in price by the time your option expires, or the other way around, that it will close lower.

If you are right, you will make a profit of 65-90% on your invested amount.

These option time frames can be as little as 30 seconds, to 2 minutes, to 15 minutes, to 1 hour, . It all depends on what you chose.

Short answer is yes & no.

In fact, it is not a scam when u consider that Binary options are in fact about as legitimate as your roulette wheel or soccer betting. Also, Binary options are simple to digest and much easier to peddle as a “transparent trading instrument”, thus attributing to its popularity.

However, very often, you end up taking the other side of the market as your broker, i.e. If you win, the broker loses and vice versa. This creates a skewed conflict of interest and their ability to adjust the payout ratio (Odds/multiplier) amplifies that.

The scam comes in when certain brokers get greedier and you start seeing instances like refusal to credit customer accounts or reimburse funds to customers; identity theft; and manipulation of software to generate losing trades.

Do not trade Binary Options.

Long story short, you have no business dabbling with binary options. You run the risk of dealing with an illegitimate broker and even if you manage to find a proper broker, you end up facing insurmountable house odds with negative expected value.

If the gambling bug bites, you might just be better off playing the lower house edge games in the casino like baccarat or blackjack.

In conclusion, there is no quick and easy money to be earned. Instead, do your homework and read.
Good luck.

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Comments ( 51 )

Didn’t read the whole post, only the conclusion.

I’ve sold structured products that had a binary content to them. Some large funds trade them. It’s an investment with associated risks like any other. Sure some people might try to rip your eyeballs out in the retail market but otherwise all good..

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Futures and Options are the same thing, just betting on movement (but by definition, you have the right to delivery/right to 100 shares yadda yadda) but we all know no one actually does that. Just a nice way around the definition of gambling.

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P&D, I would respectfully disagree that options trading is nothing more than structured gambling, if that is your position.

I’ve been an active options trader for many years, but even though I have a level 4 options trading clearance w/my brokerage account, IRAs allow for only level 1 (2 at some institutions). Level 1 meaning I can buy/sell calls/puts. Period. Level 4 allows me the ability to trade calls, puts, spreads, straddles, strangles, condors and a few other strategies. However, I keep my strategies pretty simple, keep my timeframes to weeklys or monthlys, and I use my strategies to get into a position at a cost below the CMV (by collecting premium to lower my cost basis if I’m getting assigned shares by selling puts), or by liquidating a position for above CMV by collecting premium by selling calls). Also, I like to sell straddles around earnings season, when I anticipate increased volatility. I don’t like LEAPS simply b/c it ties up my excess capital for too long.

Trading options isn’t for everyone, but they are a valuable, powerful tool when used properly. On the flip side, they can be monetary weapons of mass destruction when used improperly. The OCC (Options Clearinghouse Corp) is an excellent resource for those who want to trade options to start out. They used to have mock accounts that would allow people to practice w/o using real money. Don’t know if they still allow for that, but I found some valuable tools on the site that I hadn’t found in a number of books I’ve read on the topic.

Long-winded post I know. I’m pretty passionate about the practice, though. I have not come out on the winning side of every options trade, but all-in-all, I’ve done quite nicely, often times picking up anywhere from $300 – $2300 in a week without actually liquidating a single share in my portfolios.

I started out with options, I lost some doing stupid stuff with SPX weeklies (that’s not why I said what I said in my post above) but made all of it back and then some by simply doing directional vertical spreads. Keeps the theta low, low cost upfront, and if you have a measured move you can adjust your strike legs accordingly and up your RR ratio. Some strats are really cool and can even do for income (ie covered calls)! I actually don’t hate options, I just found I was doing great with directional plays so just went with futures. No theta decay, no expiration. I didn’t need to wait at expiration for my max profit. The money you can make in a 20 point day in /ES is vastly different than a 20 point out spread on SPX, very wide in terms of profit.

Just by reading that you keep your time frame to weekly and monthly already shows you know what you’re doing 100% (doesn’t mean a lot coming from me lol). Unfortunately this isn’t the case for 95% of traders. Most do options for the massive leverage, and doubt they even care about the whole “right to 100 shares @ a specific strike @ a specific date,” or any of the strategies that you have mentioned. There was a report I read, most option-traders blow up because they buy super low expy options, they are just betting on the direction in such a short time frame, similar to binary options. In other words, they get stuck on the level 1 approval, lol.

That’s awesome to hear, I seen your other posts, and I always love speaking to those who have been in the trading game for a while. I’ve only been in the game for around a year now, and I love it. Still very young but can’t wait to see if I can emulate what I’ve learn and applied to a much larger account size. I personally believe that the market is simple, and the people who win are those who don’t overcomplicate it.

EDIT: I generally believe selling premium is kind-of-meh at times. I mean, you’re risking like 3:1 or sometimes 5:1 for a higher probability of profit. 5-10 wins can get wiped out in 1 loss sometimes. BUT, whatever works works. Making money in the end is all that matters. the positive expectancy is all that matters.

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