When the trend is going up and is expected to do so in the foreseeable future, it is wise to consider buying the underlying asset. When the opposite is true and the trend demonstrates downward movement, consider selling the asset.
• Practice proper risk management
Another important Forex tip is to abide by proper risk management rules. In most cases you will be advised to decide beforehand the amount of money you are willing to spend on a particular deal. This way, traders can mitage loses, and get better overall results.
• Guard on emotional trading
The general strategy recognizes that emotional decisions can cause suboptimal trading results. As such, the broker advises traders to strictly follow their strategies and avoid making decisions based on their gut feelings (instead of the prevailing market conditions).
IQ Option provides clients with a demo account to enable traders to practice their trading strategies risk-free and develop their trading skills. With this strategy, you can conveniently familiarize yourself with the broker's trading platform as well as other offerings before implementing them on a real trading account.
The most popular strategies
Here are some common trading strategies from IQ Option. You can watch all educational video on the Tutorials page.
• Japanese candlesticks
Traders can use Japanese candlesticks to analyze the market and identify trading opportunities when working on the IQ Option platform. This is easily the most commonly used chart type, and a lot of trading strategies rely on the use of it. Japanese candlesticks can grant you access to advanced technical analysis tools, as well.
Some noticeable candlestick patterns include the pin bar, three black crows, engulfing patterns, and the hammer.
In trading, trendlines depict the additional lines overlaid on the price chart. They are meant to illustrate the prevailing market trend (the direction of the price movement). By using the trendlines when working on the IQ Option platform, you can highlight lucrative trading opportunities.
By using this trading strategy, you can effectively identify the current market trend; that is, whether the market is trending upwards, downwards, or in a sideways trend.
• Bollinger bands
Most professional traders closely follow the changes in the level of market volatility, and for a good reason. Growing or shrinking volatility normally indicates changes in the market conditions. Therefore, in order to facilitate the use of this strategy, the broker will provide traders with access to Bollinger Bands — an instrument that is perfectly suited for volatility tracking.
• Moving averages (SMA, WMA, EMA, SSMA)
Another noticeable strategy, available to the traders working with IQ Option, is based on the use of moving averages. Using this tool you can conveniently smooth out market fluctuations over a specified period of time and make well-thought-out trading decisions with a general picture in mind.
Some of the common averages provided on the platform are a simple moving average, an exponential moving average, and a weighted moving average.
All the tools mentioned in this article have been created with the sole purpose of making your trading activities as effective as possible. By using them, you can both mitigate the risk associated with trading, and approach it in a professional manner.