Even as a long-term investment participant in IQ Option, it is very difficult for you to build a trading strategy that is suitable for you. This is seen as a powerful tool in finding profits. If you do not have a trading strategy for your own, do not worry. In this article, I will guide you through 9 steps to set up the perfect trading strategy to become a successful trader.
- 1 Step 1: Choose a suitable trading time frame
- 2 Step 2: Identify indicators that are suitable for your IQ Option trading strategy
- 3 Step 3: Choose a reasonable trading time
- 4 Step 4: Choose a stop for your IQ Option strategy
- 5 Step 5: Measure the risk in the transaction process
- 6 Step 6: Trading principles
- 7 Step 7: Adjust your IQ Option trading strategy
- 8 Step 8: Cross-comparison between strategies to develop a more and more perfect strategy
- 9 Step 9: Trade with established strategies
Step 1: Choose a suitable trading time frame
There are many different types of trading on different time frames offered to you by IQ Option. The first thing is to determine the best time frame for your strategy.
For example, you have a few hours to trade every day. Then, to optimize your profits, you should build a short-term trading strategy by the minute or by the hour. Conversely, if you have less time (can’t track daily volatility). Ideally, you should use long-term daily, or weekly strategies.
Choosing the right time frame will make your investment go smoothly. At the same time, you are still being able to get the best out of everyday tasks.
Step 2: Identify indicators that are suitable for your IQ Option trading strategy
The essence of IQ Option trading strategy is built on technical analysis indicators. The ultimate goal is to find the most favorable entry times to open a trade.
Therefore, based on the strategy you want which is short-term or long-term, you should choose one or two indicators that are most suitable to use for your IQ Option strategy.
The trading method will focus on the indicator to build a strategy around it. Therefore, you should not choose an indicator randomly, please learn carefully.
Step 3: Choose a reasonable trading time
This is a seemingly very simple but very important step. Most investors do not pay attention to this issue while trading. You must select and define in advance: at what time and position you will place the order.
Once you have predefined a favorable position for entering a trade, you will need to take action. Stay decisive. Do not let a momentary delay make you miss out on a « delicious” opportunity. If the market has fulfilled all the required conditions, then there is no reason to hesitate.
Step 4: Choose a stop for your IQ Option strategy
After performing the above 3 steps, think about when you should stop trading. You have to choose between reaching your target profit for a day or trading until you run out of money.
Trading is a process that you can do for your lifetime. Therefore, it is necessary to have a specific schedule, such as targets of day, week, month, and year. Having short-term goals helps you best achieve your long-term plans.
Therefore, what you need to do at this stage is to take a piece of paper and write down those goals. Once you’ve completed those things, you know it’s enough for a day. And you will continue to work for the next period. Don’t try too much and then get physically and mentally exhausted in this long game.
Step 5: Measure the risk in the transaction process
After you have determined your risk management method, make a list to calculate and try to accurately measure the level of risk you may face with your strategy.
Then, determine if the level of risk is within an acceptable threshold or not. Finally, set the condition to stop when your risk limit is reached.
Trading is a game of probability and you need to accept it. There will be times when you will run into a series of losing streaks or winning streaks in one day. And you need to stop trading when the loss limit is reached. This is to avoid losing your temper that leads to burning out your account.
Step 6: Trading principles
Each investor has his or her own trading preferences that show his or her own characteristics.
Therefore, in order to establish the most perfect IQ Option strategy, build your own set of principles. This is to make sure that no matter what happens, you will not deviate from your initial goals.
This can include principles about finances, risk amounts, profits, types of assets, etc.
Besides, it also helps you avoid being dominated by emotions while trading. In order to make the right profitable decisions, principles are unbreakable things that will help you act in a more rational manner.
Step 7: Adjust your IQ Option trading strategy
Once you’ve formulated the basics of a strategy, you’ll need to test this strategy over a period of time before applying it to real combat.
These test transactions can be done with a very small deposit, or you can try it on the IQ Option Demo platform.
This is a wise step for you to determine the accuracy of your strategy to adjust. Make sure that the actual transactions will have the highest possible success rate.
Step 8: Cross-comparison between strategies to develop a more and more perfect strategy
While testing, you will most likely have to consider adjusting your time frame, trying new indicators, or approaching a new trading idea, etc. Then, you can adjust and earn some trading tips towards your strategy.
Always improve to be more complete with the fast-changing market. That is the essence of building a trading strategy.
So how do we know which strategy to choose in real trading? Your job is to try each strategy on 10-20 different trades. Then, synthesize, compare the risks – rewards, success rates between strategies. Finally, choose a strategy with the highest potential profitability for real trading.
Step 9: Trade with established strategies
Remember that in the process of making real transactions to make money, besides sticking to the IQ Option trading strategy that you have set out, you should also pay attention to record your transaction log. This is to make timely adjustments if there are errors in the investment process.
The actual trading process will help you accumulate skills or tips as well as « hard-earned » experience and develop a more successful IQ Option strategy in the future.
I wish you will find a perfect and high-quality IQ Option strategy to make money from the trading platform!