60 seconds Binary Options: what they are and main characteristics
60 seconds binary options are a particular type of binary options with expiration of only 60 seconds, and which are born as a purely speculative instrument. With 60 seconds binary options, in fact, you can do proper scalping, as traditional trading requires, with the only difference that the deadline is already set.
The forecast, therefore, must be made quickly. We must act quickly, determining the amount of the investment and the forecast, in a very short timeframe.
The 60 second binary options allow you to earn about 70-75% of the invested capital, which is why they are extremely convenient, especially if you refer to the deadline and the daily trading opportunities. In fact, it is not only necessary to consider the total gain, but it is appropriate to consider that the high performance can be reached in just 60 seconds. The gains deriving from the investment in the 60 seconds binary options can therefore be unlimited and depend substantially on what the trader’s predispositions are and on the market signals that he is able to exploit.
60 seconds binary options: what they are
In our analysis of the 60 seconds Binary Options, we will start first with a complete explanation of how they work and conclude with a couple of examples of Binary Trading.
In a 60 Second Binary Option you will simply have to predict the movement of the price of an Asset that you choose, within a deadline set in 60 seconds. In fact, it is the 1 minute deadline that gave this binary option its name. Here are some simple steps:
- Option choice: you choose the 60 Second Binary Option (often called “Short Term”, which also includes Binary Options lasting 30 seconds, 2 minutes and 5 minutes).
- Asset choice: choose the asset with which you want to trade, normally the choice falls between currencies, commodities, equity securities, equity indices. Depending on the Broker used, you will have a more or less wide choice. It should be noted, however, that in the case of 60 seconds Binary Options, the choice of assets is limited: often you will find less of them, or sometimes you will only find a certain type of Asset (like currency pairs).
- High / Low or Call / Put choice: choose your prediction for the Binary Option. As can be understood from the very name of “Binary” Option, there are only two choices: a bullish forecast, or a bearish forecast (obviously in the price of the chosen asset). Usually the High / Call forecast is represented by an upward arrow, often green. Conversely, the Low / Put prediction is represented by an arrow pointing down, often red. In 60 Seconds Binary Options this is a very important choice: in 60 seconds a few price swings are enough to make a difference.
- Amount: choose the amount to invest on the selected Binary Option. Normally there is a minimum and a maximum amount that can be invested on a single Binary Option. The minimum amount can be only € 10 or € 20, up to a maximum of € 5000 or € 10,000 (although the most important Brokers allow investments even over € 50,000). The amount must still respect your “Money Management” plan, so avoid investing all the money in your account in one Option! It is possible that you will find different amount restrictions on 60 seconds Binary Options, but this depends a lot on your Broker.
- Option Summary: once the amount has been entered, you will be shown the potential gain of the operation. In this way you will know from the beginning the possible gain and possible loss. Quickly check that you have chosen correctly and that you have not made any mistakes.
- Purchase the Option: at this point, you can buy the Binary Option you set. To proceed with the operation, click on the “Confirm”, “Apply”, “Buy” button. Once this is done, the funds used in the operation will be deducted from your account.
Once you have followed this procedure, which is practically common to all binary options trading platforms, your trade will be opened. All you have to do is to wait for the deadline which, once reached, will determine the positive or negative outcome of your investment. In the case of 60 seconds Binary Options, it is only one minute. Not even the time to drink a glass of water and you will already know the result of your Operation.
Characteristics of the 60 seconds options
Before moving on to the practical examples of Trading with 60 Second Options, let’s stop briefly to list the typical characteristics of this kind of options:
- Like any other type of Binary Option, even in 60 Seconds Binary Options you will know from the beginning your potential gain or potential loss.
- To know your potential earnings, just look at the percentages of “Payout”, or the economic return on investment. For example, if it is 75%, it means that if you invest 100 Euros, the potential profit will be 75 Euros.
- In general, the potential loss coincides with the entire amount invested. So in the event of 100 Euros invested, you will only be able to lose that amount, and no more (as it could happen in the Trading of Shares or in the Forex). There can also be the case in which Brokers offer a “Payout” even in case of loss, as a refund of 10-15% on the invested capital. Therefore, if you operate with 100 Euros, in the event of a negative outcome, you will recover from 10 to 15 Euros.
- The Payout, or Return, is usually around 75%, starting from a minimum of 65%, but can vary from one broker to another.
- What you need to do to trade with 60 Seconds Binary Options is to predict whether the prices of an asset (chosen by you) will rise or fall within 60 seconds.
- It is highly recommended to carefully analyze the chosen asset price chart, using some simple notions of technical analysis. It is good to never make decisions randomly or based on your emotions because, especially for inexperienced traders, such a behaviour could affect the success of the operations.
- These Binary Options have often been considered as real “bets”, due to the fact that they last for a very short period of time. For this reason, 60 Seconds Binary Options should be used in the presence of strong trends or during moments of high volatility, as often happens during the release of important economic news.
Example of Trading with 60 Seconds Binary Options
It’s time to show a practical example of trading with 60 Seconds Binary Options. The adrenaline will be high, because your money will be at stake. We recommend, among other things, to practice with a Demo Account.
In our example, the forecast on price trends is positive, that is, it is bullish. We therefore assume that the prices of the chosen asset will rise within the next 60 seconds. For this reason we will buy a 60 Second Option and choose the High Option (which indicates the bullish forecast). Then:
- We choose the 60 Seconds Binary Option (also called “Short Term”);
- We will choose Apple Shares as assets because, in addition to having studied the Apple Stock price charts and having noticed an upward trend, we assume that a new Apple product will be presented at 4:00 pm. A news that is usually always considered as bullish by markets and investors;
- Obviously we will choose the High or Call Option, because we made an upward forecast;
- We decide to invest €100 on this kind of binary option;
- The Payout for the Apple shares asset is 70%. This means that, in the event of a correct forecast, we would have a profit of 70 EUR. Otherwise we will lose the amount invested.
- We are ready to buy the Binary Option. Apple’s share price, when we buy the Option, is $ 111,160. It is 4:02 pm, when the news has been announced and the short rise has just started.
- Now, in order to know the outcome of our operation, we just have to “wait” 60 seconds, until the deadline.
In this case, as we have already specified above in this article, only 2 things can happen:
A) After 60 seconds, the Apple stock price, which was rising due to the news, continues to rise: we are in fact at $ 112,320 which is therefore higher than the Initial Price ($ 111,160). In this case, our bullish forecast was right and our Binary Option brought us a profit of 70 Euros.
B) After 60 seconds, the Apple stock price has decreased: we are in fact at $ 111,120, therefore the price is lower than the Initial Price ($ 111,160). In this case our bullish forecast was wrong: our Binary Option brought us a loss of 100 Euros.
As you may have noticed from this practical example, the possible results of a trading operation with the 60 Seconds Binary Option, as well as the possible choices, are always two: Rise or Fall, Profit or Loss. It all depends on the prudence with which you will decide your forecast and on the subsequent movement of the price of the chosen asset. Just by going randomly, you would have a 50% chance of getting it right. You will be able to increase this possibility by studying the graphs, paying attention to the news and taking advantage of the Technical Analysis. We emphasize that, in this case, exploiting the economic news related to an Asset is of a fundamental importance.
It will be important that your prediction guessed the direction of the underlying’s price, no matter how much. In the case of a rise, in fact, Apple’s shares could have increased by only $ 0.01 (from $ 111.160 to $ 111.161) at the end of the deadline (60 seconds) and you would have still obtained a gain of 70 Euros.
Obviously, in the event that your forecast is Bearish (downwards), you will simply have to reverse the results: you will get a profit if the prices decrease, and a loss if they increase. 60 Seconds Binary Options are only one of the various types of the available Binary Options. Check out the list of all types of Binary Options in case you want to know more.
Investing in 60 seconds binary options is simple; the steps to follow are always the same:
Choice of the asset: you choose the asset to invest on, generally the available assets refer to the following markets:
- Stock Market
Forecast: the forecast involves a binary choice, therefore you will have to predict whether the price of the underlying linked Binary Options will rise or fall within the expiration. If you believe that the price will go up, you will purchase a 60 second binary option of type Call; in the event that you believe that the price of the underlying will drop, you will buy a binary option of type Put.
Choice of capital to invest: the last choice will concern the capital to invest. It is the most important decision, as it is true that if the investment is successful you will earn 70% of the invested capital, but it should not be forgotten that in the event of a negative outcome, you will lose 100% of the invested capital. You should therefore avoid investing 100% of the capital on a single 60 second binary option. Instead, only 5% of your total capital should be put at risk. For example: if you have deposited € 100 and you invest € 5 for each binary option, in case of loss you will have lost only 5% of your capital, an easily recoverable amount.
We also remember that the winning strategies for 60 seconds binary options are different and varied, but here we are going to present you one of the most used and safe. Using this strategy you have the possibility of obtaining winnings that can even touch 80% of the invested capital, but at the base of your trading there must always be a good ability to read market graphs.
Winning strategies for 60 seconds binary options with RSI oscillator
One of the most common 60 second binary options strategies is that combined with the RSI oscillator. Recall that the oscillators are used to identify a loss of strength of the current trend, before it can appear on your price chart.
As you can see, this tool is very important, because if you know how the market is going to behave, you will also know how to invest in order not to lose money.
The market moves on the basis of the impulses of the market players; the stronger the impulses, the more the market will have directionality. We also want to clarify that it is very rare to see a market move in one direction with the maximum decision, but very often these are only corrections due to indecisions in the current trend.
That said, RSI stands for Relative Strength Index and measures the relative strength of a value in a specific period of time chosen at the trader’s discretion.
The oscillator, as seen in the graph below, is a line that moves between 2 values of 0 and 100.
We just consider 2 areas:
- the oscillator line is above 70, so we go to an overbought area;
- the oscillator line is below 30, in this case we are in an oversold phase.
For your investments in binary options and to obtain a successful strategy you can use the RSI obtaining success in the following cases:
- Purchase Put options when the oscillator is in the overbought are, therefore above 70;
- Purchase Call options when the oscillator is in the oversold area, therefore below 30;
ANOTHER EXAMPLE OF INVESTMENT IN 60 SECONDS BINARY OPTIONS
Here is a simple example of investing in 60 seconds binary options. Let’s see how to act to profit from this fantastic trading tool.
First, as we have already specified, we are going to choose the asset. In the 60 seconds binary options it is advisable to choose very volatile assets, otherwise you risk not being able to have appreciable market movements in such a limited period of time. The most volatile assets are those belonging to the currency market, the Forex. In this case we have chosen the EUR / USD currency pair because it presents a graph showing a price resistance, i.e. an area where the price has rebounded several times.
We take advantage of the subsequent rebound, and we are going to invest, aware of the fact that the price could reach higher points than we hoped for and, in case it happens, all we have to do is to invest again on a higher price level, so to ensure the effective drop in prices.
In our case, in fact, the price reached a higher point and gave us the opportunity to invest again. In the first investment we have put € 100, in the second, which is more likely than the first, since the price has further increased, we have invested € 200.
At the end of the 60 seconds, which are certainly the most exciting 60 seconds of the whole day, we get: A GAIN! Our 2 binary options have expired:
The first has expired exactly at the same price as the initial price, when we purchased the binary option: when this happens, the profit is zero: we take back the invested capital, 100 Euros
The second binary option instead gave us much more satisfaction, in fact, we earned 140 € in just 60 seconds!
The profit obtained with the investment in 60 seconds binary options is in fact very large, if one takes into account that it can be achieved in just 1 minute.
PLEASE NOTE: Investment in 60 seconds binary options should not be taken lightly. We always advise you to invest only 5% of your capital for each operation, in this way you will guarantee yourself much more chances of winning. Otherwise, what you will do will no longer be an investment, but a simple bet, for which you have casinos!
60 seconds Binary Options: 3 winning tricks
In order to successfully invest in 60 seconds binary options, here are 3 tricks to follow to get the maximum profits:
- Trick n.1: know the markets where you invest
In this case it is important to invest only and exclusively in the markets we know; every day you have to follow the markets and investing only in 2-3 markets.
- Trick n.2: Choose the best broker for 60 seconds binary options
You can choose the best broker for 60 seconds binary options based on the characteristics most conforming to your trading, in the below paragraph.
- Trick n.3: Do trading
If you want to become a good trader you must learn to trade; to learn how to trade you have to practice, with the sole objective of doing many trading sessions per day; this way you can maximize your winnings by limiting your losses.
The demo account, especially in binary options, is very useful to the trader as he is called to undertake a training course if he wants to start his career in the best way. The demo account allows the trader, once he has chosen the broker, to be able to try the 60 second strategy and practice it without losing his capital.
Therefore, what we mean with demo account is a particular type of account that allows all traders to trade on the real market, but using virtual money offered by brokers, with the sole and simple purpose of giving the trader the possibility to train not only with 60 seconds binary options, but also with the other types of options.
The demo 60 seconds binary options reflect all the functions that you can have when you use a real account.
To request the activation of the demo account, just register with the selected broker and choose the activation of the demo account function.
Unfortunately, the emotional factor is not taken into consideration in the demo account, as virtual money is used.
BROKER TO INVEST IN 60 SECONDS BINARY OPTIONS
There are many brokers who offer investment in 60 seconds binary options, but we advise you to trust only and exclusively the BROKERS REGULATED BY THE EUROPEAN UNION. If you invest with regulated brokers you are sure that your capital is protected, otherwise you take all the related risks. Here is the best broker for binary options!
IQ Option is a regulated and authorized broker, suitable for all traders who want to invest in online trading with binary options, whether they are beginner traders or Guru traders. Thanks also to its bonuses and the training offered, all traders can not only trade like real professionals, but they can also participate in IQ Option tournaments.
IQ Option Advantages
- free demo account;
- minimum deposit of 10 €;
- wide range of information material;
- numerous strategies explained in detail;
- Monthly trading tournaments;
- professional trading platform;
- technical analysis;
- maximum payout up to 90%;
- quick deposits and withdrawals;
- iOS and Android mobile platform.