Trading 60 Sec Binary Options: The Ultimate Guide
60 sec binary options have become hugely popular in recent years. Their fast-paced nature allows traders to capitalize on short-term market movements. However, 60 second options are not for everyone. Success requires an effective strategy, discipline, and quick decision making. This comprehensive guide covers everything you need to know about trading 60 second binary options successfully.
What are 60 Second Binary Options?
60 second binary options, also known as turbo options, are option contracts that expire within 60 seconds. You have two possible outcomes – if your prediction is correct, you receive the predetermined payout. If incorrect, you lose your initial investment.
Payouts typically range from 60% to 85% but can reach as high as 500% on some platforms. The assets available to trade vary between brokers and include forex, commodities, stocks, and indices.
How Do They Work?
When you purchase a 60 second binary option contract, you predict whether the asset’s price will be above or below the target price when the option expires. For example:
- You believe the EUR/USD will be above 1.18500 in 60 seconds
- You invest $100 in a CALL option
- If the EUR/USD is above 1.18500 when the option expires, you receive the predetermined payout
- If the EUR/USD is below 1.18500 when it expires, you lose your $100
Once you purchase the option, you cannot exit early – you must wait for full expiration. Timing is critical, as even slight price movements can determine the outcome.
The Pros of 60 Sec Binary Options
- High potential returns – payouts up to 500% are possible on some platforms.
- Ability to capitalize on short-term opportunities – you can jump in and out of trades quickly.
- Low minimum trades – many brokers allow 60 second trades with just $1.
- Simplicity – only one decision to make (higher or lower).
- Adrenaline rush – their fast-paced nature provides excitement.
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The Cons of 60 Second Options
- High risk – the speed makes losses fast and frequent.
- No early exit – you cannot exit profitable trades early or cut losses.
- Over-trading – the quick turnover tempts over-trading.
- Less analysis – the speed leaves little time for technical analysis.
- Lower payouts – typical payouts are lower than other option types.
Keys to Success with 60 Second Options
Success in 60 second binary options requires:
- An effective strategy – random guessing will not work. You need a tested strategy.
- Swift execution – delays in entering or exiting can make the difference between profit and loss.
- Focus – distractions will cause missed opportunities. Give trading your full attention.
- Discipline – stick to your strategy and money management rules. Don’t let emotions take over.
- Risk management – only risk 1-5% of capital per trade. Losses mount quickly on 60 second options.
- Quick reaction time – you must act fast to capitalize on opportunities before expiration.
- Experience – new traders should gain experience first with longer expiries to avoid losses.
Strategies for 60 Sec Binary Options
There are several strategies commonly used for 60 second options:
- Trend following – identify an asset in a strong trend and trade in the direction of momentum. Use indicators like MACD and RSI to spot trend strength.
- Reversal trading – look for assets that have made a strong move in one direction and are likely to reverse. Trade the expected bounce off support and resistance levels.
- News trading – major news events can cause increased volatility and price spikes. Buy options in the anticipated direction right before news releases.
- Range trading – trade reversals between support and resistance levels when an asset is ranging. Use Bollinger Bands to identify support and resistance.
- Scalping – attempt to make multiple small profits on minor price movements. Requires fast execution and high volume.
Managing Risk with 60 Sec Binary Options
Risk management is critical when trading 60 second options due to the high speed. Tips to manage risk include:
- Limiting per-trade risk to 1-5% of capital
- Capping total daily loss to 10% of capital
- Avoiding over-trading by limiting total daily trades
- Not doubling down or revenge trading after losses
- Using a demo account to test strategies risk-free
- Only trading when focused and avoiding distractions
- Setting a profit target and stopping after reaching it
- Keeping detailed records to review performance and mistakes
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Getting Started with 60 Sec Binary Options
Follow these steps to begin trading 60 second options:
- Choose a broker – select a reputable broker with 60 second options and a demo account.
- Open a demo account – use virtual funds to test strategies risk-free.
- Develop your strategy – use technical analysis to create rules for your strategy.
- Backtest the strategy – check historical data to see if your strategy works.
- Start small – begin live trading with 1-2% of capital per trade. Use demo account.
- Review performance – track results to refine strategy and improve discipline.
- Increase position size – gradually increase trades as you gain experience.
- Withdraw profits – regularly withdraw a portion of profits as account grows.
With the right broker, solid strategy, and risk management, 60 second binary options offer an exciting way to profit from short-term price movements. Avoid pitfalls like over-trading and stick to tested rules for the best chance of sustained success.