So far you have learned the basics of Nadex Touch Bracket Contracts. You should have a firm understanding of the overall structure of the contract and how they work; however, there is no substitution for the actual experience of placing a trade and tracking the market as it moves for, or against your position.
Let’s take a look at the steps to get started trading Nadex Touch Bracket Contracts.
Step 1 - Touch Bracket contracts are only offered by Nadex.
They are the latest evolution of contracts designed for the individual trader. The contracts, as discussed, offer many benefits to traders. Trading though, regardless of what you are trading, involves risk, and it is important to practice and thoroughly understand the instruments you are trading. So, for step one, if you haven’t done so already, open a Nadex demo account.
The demo account is free, comes with no obligation, and is a great way to get some solid experience.
The demo account will not teach you the emotions that come with risking real money in the markets, but it is a good first step to understanding the contracts and to limit basic mistakes that can be made when trading on a new platform or trading a new contract.
Step 2 - Identify which markets you want to trade.
Initially, Nadex Touch Bracket Contracts will be offered on the top four major currency pairs and the top four US equity index futures.
If you’re not sure what markets are best suited to your trading style, try them all, risk-free, in the demo account.
Each market has its own flow and nuances, and it is very helpful to understand the characteristics of each.
Step 3 - Choose your direction.
Once you have determined which market, or markets, you would like to trade, you will need to determine a direction.
This can be done using price action, technical analysis, fundamental analysis, or whichever strategy you prefer, which may include a combination of all the above.
Step 4 - Buy or sell?
Are you bullish on the market? In that case, you will open an order ticket and place a trade to buy the contract. In this case, you would likely look to place a trade where the floor of the contract is in close proximity to the indicative index, giving you a beneficial risk/reward ratio.
Are you bearish the market? In that case, you would likely place a sell order where the ceiling of the contract is in closer proximity to the indicative index and for the same purpose, to place a trade which provides a positive risk to reward ratio. Now, place the trade.
Step 5 - Monitor your position.
Once the position is established, monitor your trade and watch how it moves within the boundaries of the range. Look at the performance of the contract as the market moves, either in your favor or against.
With every trade, whether in a simulated account or using real money in the live market, monitoring your position can provide a lesson which may prove extremely valuable to future trades.
Now that you’ve gotten a basic start to trading Nadex Touch Bracket Contracts, let’s take a look at some simple strategies.
What to read next:
- What Are Touch Bracket Contracts?
- How to Get Started with Touch Bracket Contracts
- Touch Bracket Trading Strategies