Many people wish to get into trading and start earning extra income on Binomo. However, there are many nuances that beginner traders should consider. In this article, we will tell you the mistakes you should not make if you do not want to lose your account and funds.
How can you destroy your account?
During registration on Binomo, you will be asked to read the Client Agreement and Privacy Policy. If you do not do this, you will make one of the fatal mistakes of novice Binomo traders. Why is it important to read the rules and not just check the consent checkbox?
Firstly, studying the terms and conditions will help you understand how the platform works before you start trading on a demo account or investing in a real one.
Secondly, violating the rules may result in your trading account being blocked. For example, Binomo prohibits minors from registering. You also cannot own multiple accounts at the same time. Therefore, if you already have an account, you must block it before creating a new one.
Main mistakes
In addition to those that lead to blocking your trading account, some mistakes can lead to the loss of invested funds. Let’s discuss them in more detail.
Trading against the trend
Trading against the trend is one of the most common mistakes of beginner Binomo traders, leading to loss. Hoping the market will reverse at some point, you will probably want to start trading against the current trend. However, it may be some time before a reversal occurs (if it happens soon at all).
It turns out that the fight against the trend can bring you several losing trades or even empty your trading account. For example, if you forecast that the asset price will fall in a rising market, it is likely incorrect, and you will lose your investment.
Note! Beginners are advised to avoid trades when the trend is reversed. Better to wait until it recovers.
Large investment in one trade
Investing all your funds in one trade is hazardous, as there is no guarantee that your forecast will be correct. Despite the prevailing trend, the market sometimes reverses, and you can lose the investment.
Remember that one significant loss can negate the additional income from several trades. To reduce this risk, you must develop your capital management strategy. For example, invest a maximum of 2-5% of your Binomo account balance in one trade.
Choice of short timeframes
Binomo offers to trade on short timeframes (as little as 60 seconds). It is very tempting as it can be more profitable than trading on longer charts. However, such trades are risky, especially if you have just started your journey on Binomo. If you cannot make decisions very quickly, this can lead to panic and random trades.
Note! Trading on short timeframes, including 1-minute ones, is suitable only for those who can keep their emotions under control and make informed decisions.
Dependency on a single approach
Strategies are not tricks that will bring you additional income from trading on Binomo but methods based on technical analysis. No technique can guarantee a 100% result for each of your trades.
The market is volatile, so you must constantly analyze it and adapt your strategies to its conditions. It is also essential to learn to understand the micro- and macroeconomic factors that affect the assets you trade on Binomo.
Lack of practice and knowledge
Trading comes with a high risk of losing some or even all of your investment. Education and training can reduce this risk, but not every trader understands. Therefore, one of the main mistakes is the unwillingness to learn and practice.
Do not rush into real trading right away. Use the free tutorials on the platform to understand how Binomo works and how to trade. The “Education” section contains video instructions on how to use different types of charts, how to deposit, etc. You can also go to the Help Center, which contains detailed articles with answers to frequently asked questions from traders.
The demo account, available immediately after registration, has a virtual $10.000, which can be replenished unlimitedly. It is a safe environment for learning to trade on real charts, where you do not risk your funds.
Note! Even if you have already deposited and received a real Binomo account, you can switch to a demo to learn how to work with indicators, test some strategies, or try a new asset.
Trading in an emotional approach
Emotionality and haste when trading can also lead to losses. Instead of panicking and opening random trades in the hope of getting lucky, you should develop your financial system and stick to it.
Set the maximum allowed loss level, and stop trading as soon as it is reached. If you have made several incorrect forecasts in a row, it is also essential to stop and analyze the reasons for this.
Waiting for a profit
Most traders don’t want to admit that trade mustn’t be profitable. Beginners often use a calculator to determine how much they will receive and think ahead of time about how they will spend those funds.
Thinking in advance about how much you will get from trading today can be dangerous. Remember: the market doesn’t owe you anything. The correct approach is a neutral attitude. Carefully analyze the market, and follow the trend, but at the same time, be prepared that your forecast may turn out incorrect.
Blindly following programs
Traders are increasingly turning to computer technology, as many online platforms provide ready-made tools for research, charting, and backtesting. However, relying too much on these tools is another common mistake.
Yes, the software can provide the information necessary for technical and fundamental analysis. However, it is intended to help you improve your strategies and not blindly follow the program’s directions. If you do not understand the principles by which the machine generates trading signals, you should not follow them.
Conclusion
Even the most experienced traders make mistakes sometimes. The key to reducing the risk of losing capital is constant learning and enough practice on a demo account. You must develop and continuously improve your trading strategy. Avoid common mistakes and try to learn from the ones you have already made to adjust your approach. Do not follow ready-made signals, and do not believe that there are tricks that guarantee a 100% result of trading on Binomo.
