Best Time To Trade Binary Options
The successful one is the one that know how to take advantages of all coming opportunities. That explains why timing is the most important factor in every happened event during your lifetime, especially if you are a financial investor. Binary options are a part of online financial world, where asset’s prices change within seconds out of your control and imagination. Hence, timing is even more essential.
Recently, US traders were approved to make trade on some platform while many others are still embarrassed in choosing the best time to purchase these exotic options. After a long time of research, a group of professional has summarized all necessary clues to help you understand when is suitable to maximize your trading profit.
Understanding Binary Options
First of all, a trader should understand binary option’s characteristics from inside out to simplify his management. These options are very different from others such as vanilla options. Once you are in the game, you have no ability to changed expiration time or to close it anytime you want. Regardless to the chosen underlying assets and the type of purchased instrument, nothing is more important than timing.
Once involved timing factors are learn thoroughly, any investors have certain possibilities of earning significant profits on trades. Perfect timing could bring you 80% of initial investment amount within an hour or even in one minute. Such incredible profits couldn’t be seen with any other markets, even though it is highly profitable trading stock.
An important aspect of timing an option is how to understand the market of underlying assets. Assets could be stocks, currencies, indices and commodities. Therefore, each market for each of these categories contains its own natures. For example, the S&P 500 is an index tracked on the New York Stock Exchange (NYSE) while the FTSE 100 is tracked on the London Stock Exchange (LSE).
Stocks and Indices
For assets on Stock and Indices categories, timing depends on the opening and closing for the day. Currently, most stock exchanges are opened for six to eight hour a day and closed on weekends and national holidays. However, because each country celebrates its own holiday, so traders have to take note of the holidays that affect particular markets.
In our opinions, the best time to make a stock or index trade is when the market open and active. For the NYSE, this is from 8:00 a.m. to 5:00 p.m. EST. For the LSE, the best time to trade is from 3:00 a.m. to 12:00 p.m. EST.
Forex currencies trading are considered as sleepless market because it’s always open somewhere in the world. Hence, the best time of this category is the time that both major forex markets are open. For investors in the U.S., the best times for currency trades occur when the New York forex and the London forex overlap and when the Sydney forex and the Tokyo forex overlap. The New York/London overlap occurs from 8:00 a.m. to 12:00 p.m. while the Sydney/Tokyo overlap occurs from 7:00 p.m. to 2:00 a.m. You could check out the timing and the charts at Binary Options Chart.
Assets that are classified in Commodities category is the most difficult in determining best time to trade because trading occurs at odd hours of the day. It also varies for different commodities even on the same market. Nevertheless, thanks to the limitation of tradable commodities on platform, this difficulty is reduced a lot. In the U.S, most common commodities are best for trade at:
- Gold – 8:20 a.m. to 5:15 p.m. EST
- Silver – 8:25 a.m. to 5:15 p.m. EST
- Crude oil – 9:00 a.m. to 2:30 p.m. EST
- Natural gas – 9:30 a.m. to 5:15 p.m. EST
Timing by Type of Option
Binary options have a variety of trading instruments. In spite of their minor difference, we still need to learn in order to minimize their bad effects on our transactions. Here are individual keys for the most three common types of options:
- High/low options -These traditional options is the most simple one, in which an investor only have to decide if his chosen assets will end up higher or lower than the strike price. Generally, these options are suitable with short-term investments that last less than a month. In fact, many investors prefer trading multiple times in a single day from over several days
- Touch options-Touch options relate to the ability of meeting each other between the asset’s price and a determined point during period of expiration. The most important aspect is the strike price, and an investor has no other choice but waiting for a favorable strike price to start purchasing his options.
- Range options –A range options contains two limitations: the upper and the lower. You win if your asset’s price is located in those barriers when the time is up. Professionals advise that you should start your trade immediately when the assets have been low for some time and are experiencing low volatility. This requires for a time of updating information constantly.
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