Becoming a skilled options trader requires hard work and patience. Unless you push yourself hard, you will never learn to trade the options market in a professional way. Most of the time, traders start their careers without having enough knowledge and thus they lose money. But the professional traders always take their time and pay attention to the important details of the market. Thus they are able to manage their trades more efficiently.
As an options trader, you should be very careful about the trade execution process. Once you start relying on the quality trade signals, you will notice an improvement in your trading performance. But the problem is, you will find fewer trade signals. To overcome this issue, you might switch to a lower time frame. Though lower time frame trading will provide more trading opportunities, the risk factors will be also high. In this content, we will give you some powerful tips which will help you to trade the lower time frame like a pro trader.
Strong analytical skills
Before you start taking the trades in the lower time frame, you should focus on your analytical skills. Unless you become good at the trade analysis process, you will be losing money most of the time and thus you might blow up the trading account. To avoid such a problem, you should be trading the market in the demo account for few months. During the practice trading session, you should work hard and try to improve your trade execution process. Once you develop the basic technical analysis skill, you may start dealing with the options market with real money.
Selecting the broker
To trade the options market in the lower time frame, you should be carefully select the premium brokers. Most professional traders trade options online with high-end brokers like Saxo. They know very well that if they chose to trade with the low-end brokers, they will keep on losing money and blow up the trading account. You might be wondering that the high-end brokers will charge more fees. But if you evaluate the trading fees of the high-end broker, you will be surprised to know that they always provide optimized fees. So, you don’t have to worry about your trading cost.
Avoid trading the news
Since you will take the trades in the lower time frame, you should not trade during the major news. The market has become extremely volatile and becomes nearly impossible for retail traders to find reliable trade signals in the market. But if you carefully assess the actions of the professional trader, you will notice that they always trade during stable hours. So, how do we find stable trading hours? To do that, we have to know about the Forex economic calendar. Most of the time, the market becomes extremely volatile right after the major news. Unless you are careful about this news event, you are going to keep on losing money.
Look for the major chart patterns
Novice traders often ignore the power of the chart pattern trading method in the options market. Though you will be trading the lower time frame, still you should be looking for the emerging pattern. If you spot a reliable pattern, never take the trades unless the breakout takes place. It might take a while to get used to the breakout trading method but once you become comfortable, you can easily make a regular profit without having much trouble.
Take your time and learn to evaluate the risk profile while dealing with the critical chart patterns in the market. And try to maintain a decent risk to reward ratio in the options trading business even though the success rate in chart pattern trading is very high. Always be prepared to deal with the losses as it is the only way to protect your trading capital and make a regular profit in the market.
