Many traders fail – How to spot your trading mistakes on Binomo

Statistics show that nearly a large portion of the retail traders aren’t able to be profitable.

Nevertheless, even these 90% of trading accounts make a profit from time to time. But overall, they have more losing than successful trades, evidently reducing the balance on these accounts.

The big question is why do many traders lose money or struggle to make any in the first place?

The main reason why many traders lose money is inconsistency. They know dozens of trading strategies and try to use them in every market they trade. They also trade several markets at the same time.

Most traders have no clear trading plan and no strict rules for trading. These traders might have multiple trading strategies and trade all the available assets on Binomo. But perhaps the key to success is consistency. Staying with one strategy and one instrument for an extended period of time. Losses are inevitable, but if you stick with your strategy, you will be consistent.

What most traders do is jump from one strategy to another after every losing trade. They jump to different trading instruments, use different indicators, and increase the trade size each time. Does this sound familiar?

It is ok to try out various trading strategies and different money management rules. The problem is, these traders do it on a live trading account. But, if you want to experiment, always do it on a demo account as this is the actual purpose of this type of account.

As you experiment with a trading strategy, you might find what works best for it. Let’s say it works best at a specific time or day of the week. Maybe on a specific timeframe or trading instrument. Or perhaps in a specific trading condition such as a ranging or a trending market.

This is the key to success – consistency! Now you know the “secret” to avoid guaranteed losses when trading on Binomo. It is time to dive deeper into all aspects of consistent trading.

The main reason why only 1 out of 10 traders have profits on Binomo

As already mentioned, consistency is the key element as to why only 10% of traders are able to make a profit on Binomo. But what they are actually are consistent at? The answer is the consistency at following one strategy. The strategy that has proved to be relatively profitable over an extended period of time.

(In fact, none of the strategies can guarantee a 100% success and profit.)

It could be a surprise for many, but there is no holy grail and most trading strategies are able to show potentially good trading results. However, a successful trader must be very specific at choosing trading instruments, timing, and timeframes when applying a strategy. Having said that, profitable traders make it as simple as possible and reduce the number of trading strategies they use to the very minimum. 

Each strategy has a unique purpose and a very specific use-case. For example, one strategy works best on online derivatives trading platforms and another strategy works best with the long expiry times. One strategy works best in a ranging market while other work best in the trending market.

How to join the team of successful Binomo traders

When you find a trading strategy that you like, the first step would be to test it on a demo account. Not just try it for one trade, but apply it to multiple instruments, multiple market conditions, multiple expiry times and practice it several times. 

Some strategies will show good results, while some will make your balance go down. Strong statistical data will provide a good understanding of which strategy works best. It will also give a good idea about how and where to use it for maximum profitability.

Each trader is different and has their own preferences. Therefore, it is important to have a strategy that you love. And at some point, you will discover a strategy you are comfortable trading with. 

Get very specific when trading: from the beginning you should try to limit yourself on the number of strategies and instruments for trading. Because when trading only few markets at a time will allow you to study them. 

It is like getting to know a person, once you see them every day, you know their habits and can expect certain behavior depending on the situation. The same is with financial markets, each instrument is like a living creature, just take your time to get to know it better. 

The next and very important step is to apply proper money management to your trading approach. Money management plays one of the most important roles in trading, along with trading psychology.

The term “money management” speaks for itself. You must learn how to manage your money. To be more specific, you must apply a set of rules within your trading strategy which tells you exactly how much and when to invest. This will potentially protect your capital from huge losses and will help to produce profits consistently. There are many money management techniques, but you must apply the one that you are most comfortable with. This will remove the psychological pressure and allow trading with peace of mind.

While there are good and bad strategies, it is not that hard to find a profitable one. The problem is once a trader finds it, the strategy continues to perform well, but the trader fails. 

Be consistent, and you will avoid failure. 

Try to use money management and you more likly to will avoid failures. 

Don’t get emotional, and you will avoid failure.

Understanding markets you trade

It is extremely important to distinguish the market condition you are trading in. It will enable you to be more effective when making a trading decision. The ability to understand whether the market is ranging or trending will help to choose the right trading strategy and the best timing to initiate the trade. 

 

Sometimes the best thing to do is sit back and relax. Wait for the market which looks familiar and where you can recognize the pattern. This will remove any doubts when placing the trade, as well as remove any stress and the fear of the unknown. 

Why stick to only one trade instrument when starting on Binomo?

If you are a beginner trader, perhaps best would be to trade only one trading instrument. For many, financial derivatives are the easiest to grasp as this market is being very consistent in relation to the stock or cryptocurrency markets. There are no huge moves in price and it much less volatile. These are the main reasons why derivatives market is the choice for new traders.

If you are serious about earning a profit, stick to one financial instrument. Get a deeper understanding and find the best Binomo trading strategy for this instrument. This should help to potentially increase your profit ratio and of course the profitability.

If you’re starting out, I would recommend trading with one financial instrument and preferably a currency pair. 

Focus your energy and attention on one thing, one strategy, one approach. Learn, understand, master it, get confident, and good lock!

Good luck!