Implementation of trading binary options strategies is a continuous process, which every trader should apply in his/her everyday investment. It is possible to reap the benefits of binary trading if you learn the strategies here and then implement them efficiently in your trades.
Contrary Opinion Strategy
As mentioned earlier, every trade, whether a beginner or an advanced trader should implement trading strategies in order to make good profit. Contrary opinion strategy is a prediction of the future price movements of the underlying commodity. You will not rely on the market history of the commodity; you will use the sentiments of the market players. You have to gain a deeper insight of the market movement.
Contrary opinion strategy might work for advanced traders, who have been in the field for a long time. A beginner might not understand the concept of predicting the price movements of a commodity. However, a trading guru, who has been in the market for some time can pair this strategy with a trend-based strategy and make incredible profits. This fact should not be discouraging factor for a beginner because a long journey starts with a single step.
Importantly, contrary opinion is a unique strategy because it is neither a technical analysis nor a fundamental analysis. This strategy is a unique approach that can be rightly identified as a psychological analysis. The fundamental concept of contrary opinion strategy is that if a large number of current market players agree on something, it is wrong. Subsequently, the trader establishes the real cause of the people’s sentiments based on the market conditions. Ultimately, the trader takes a different approach.
If you want to perfect this strategy, you can follow the financial newsletters available in the best binary option sites. The financial newsletters will reveal how the traders feel about the current market. However, you must be good at interpreting the market prices. That is why this strategy is only useful to experienced traders. You must have a basis for your opinion, based on percentage. You derive your opinion depending on whether the asset is oversold or overbought.
Nonetheless, some traders can use the concept of supply and demand to come up with an opinion. Apparently, an upward trend in a commodity means that the demand will exceed the supply price. When a significant number of traders are moving higher on the trend, the logical assumption is that willing traders have already bought the asset. Consequently, there is no more demand to push the prices higher. Ultimately, the market will turn around when supply will exceed demand.
It is important to note that contrary opinion works on a long time scale. It can help you identify price extremes that can trigger market turnarounds. In this regard, you should combine this strategy with another strategy, for instance candlestick formation.