Versatility may not be the first quality that comes to mind, when Binary Options is brought up for discussion. After all, there are just two ways a trade can go: and it is not like there are many tools or ways of trading that can be used to create diverse trading systems, as is the case in Forex Trading.
However, in Binary Options, you can trade any of a large repertoire of assets. Anything from stocks, to currencies, to commodities: and the list keeps growing with numerous additions by enterprising brokers. Although, the variety of assets offered differs across brokers, there are usually a decent number of assets to trade with a top-grade Binary Options Broker.
Understanding the different Binary Options Trading Market Hours & Schedules
With a vast array of assets to trade, would not it be perfect to be able to place a trade at all times? In a way, you can in Binary Options Trading: but technically, you would not be able to trade all assets at all times.
Here is the deal, stock exchanges trade as specific times of the day, so stockbrokers and other people who work in the industry can go home to their family and live normal lives. And then, there’s the Forex currency market that is closed during the weekends and half the day on Friday, for basically the same reason why the stock exchanges shut their doors after certain hours had gone by.
These are the two major markets, but that’s not all. Even, Forex still maintains core trading hours in four major trading centers, where much of the money on Forex is traded, resulting in high volatility and profitability (if high trading activity is your thing).
Aside the obvious, “Hello, you can only take a Binary Option position on a NYSE stock pick only during NYSE trading hours, and likewise for other assets that are available at only specific trading hours,” the different market hours and schedules influence the kind of Binary Options trading strategy you use.
While one strategy may require you to take up high volatility assets and trade during busy trading hours, another may require you to do the exact opposite.
You would also be able to manage different assets across the board, if you wish, and maintain profitability. Diversification reasons and/or increasing one’s portfolio are two top reasons why a trader might go this route. Either way, Binary Options offers the versatility to do so.
Also, you may not be available all day to make trades, and seeing that regions have different time zones, it would make sense to note the market hours and schedules of options assets you are interested in trading.
What are the Binary Options Trading Market Hours & Schedules
The two major Binary Options asset categories by market are the Stock Markets and Foreign Exchange Currency Market. We will discuss the trading market hours for both categories separately:
Assets in US stock markets are amongst the most traded in this asset category. In general, stock markets in the US are open between the hours of 09:30 (9: 30 AM) and 16:00 (4:00 PM) Eastern Standard Time (EST).
Best Binary Options Brokers 2020:
Free Trading Education!
Free Demo Account!
Big Sign-Up Bonus!
However, if your trading strategy is dependent on the volatility of the market, it may interest you to know that activity usually fall to low levels between the hours of 12:00 (12:00 PM) and 13:00 (1:00 PM) EST—which corresponds to lunch time for traders. For the highest trading activity, endeavor to take up positions during the early trading hours before lunch (in the morning).
Aside, US stock indices, Binary Options traders, in their numbers, also trade assets in Europe. Popular stock market choices are the FTSE AND Xetra Dax. Market hours for these markets hover around 07:00 (7:00 AM) or 08:00 (8:00 AM) to 15:30 (3:30 PM) or 16:30 (4:30 PM) on weekdays.
Foreign Exchange Currency Market
Although there are several currency and commodities market, Forex is the most active, and it makes a name for itself by being available for 4 days (24-hour days) and half straight without breaks in between.
While the Forex market is generally not limited physical trading exchanges, there are four major financial centers where a lot of market activity happens. These centers only have their door open for a set number of hours per day, much like stock market exchanges. They include, London, New York, Sydney, and Tokyo.
The trading times of some of these centers overlap at certain periods. An example is the London/Tokyo overlap. The London and New York trading times also overlap, and is pretty much a big deal, with lots of swings occurring during the overlap.
In all, times may be shorter for a specific broker, so you should consult your Binary Options broker to confirm trading times for chosen assets.
Most volatile currency pairs
In our last article we covered market hours & schedules, not lets talk about volatility in binary options trading.
What is Volatility?
In currency trading, volatility refers to the range of changes in value of a currency pair within a certain amount of time. When the range is high, a currency pair is deemed to have more volatility, while a currency pair is deemed to have low volatility when the range is low.
There is no widely accepted level above and below which a currency pair is thought to have high or low volatility (although the EUR/USD pair is used as a benchmark, since it occupies a central position between the highest and shortest ranges). Usually, volatility of currency pairs is used as a relative measure to compare currency pairs, than a definite measure.
How does Volatility affect Trading in Binary Options?
Amongst the long list of assets traded in Binary Options, currency pairs are a popular bunch. Consequently, the volatility of a trade pair and its average pip value influences what strategy a trader uses. Therefore, while some traders may yearn for volatility, others may shy away from it.
What makes Volatility Desirable in Binary Options?
Binary Options is also referred to as Single-payment options trading because of the nature of trading positions taken. Clearly, with a volatile pair, a trader can take high-value positions without falling out-of-the-money, thereby making huge gains. With increasing volatility, the positions can be higher and more positions can be taken.
It is important to exercise caution. As is the case with leverage, high volatility can lead to quick monumental losses if the market goes against your position.
What are the Most Volatile Currency Pairs?
The volatility of currency pairs is not static. Because the average daily trading range (in Pips) of currency pairs are measured annually, the relative position of currency pairs in an organized chart fluctuates.
Therefore, it is best to describe the most volatile currency pairs in terms of how often they appear high up in the chart, than at what level they appear in a specific annual duration.
With this in mind, the three most volatile currency pairs, in no specific order, are:
The other two currency pairs making the five most volatile currency pairs list are GBP/CHF and EUR/JPY.
For comparison, the three least volatile currency pairs are NZD/USD, EUR/GBP, and EUR/CHF.
BINARY OPTIONS TRADING SCHEDULES AND OVERLAPS
Binary Options Trading is all about adding several options to enhance one’s trade game. The investments may be in the form of assets, commodities, currency and much more depending upon your needs and budget. Therefore, binary options provide a certain amount of versatility and open an economic corridor for investments.
Acknowledging different Binary Options Trading Schedules
It will be a profitable thing when you have several options to invest in. But practically, it will not true if we say that one would be able to invest in all the market at all given times. Trading is all about timings. The deal is that the foreign exchange market which also termed as Forex is open 24 hours a day but only 5 days a week. The leave of 2 days and a half of Friday enables the people to get back home to their loved ones and relax.
Similarly, stock market activates for specific time intervals and closes for some time to provide a relaxation time for the stockbrokers. The availability of different trading options round the clock can prove way more profitable and beneficial than one can imagine. Therefore, you must understand the basic marketing techniques to invest at any time in different assets and commodities. Binary options trading help you to diversify your portfolio by opening several trading options.
What are the Binary Option Trading Schedules and Possible Overlaps?
The two trading powers in the world are the Stock market and the Foreign exchange market. Both of these markets are essential for investing in anything. In this article, we are going to unleash the trading schedule and possible overlaps one by one.
The stock market is the highest trading market in the premises of the USA. It starts to act in the USA at 9:30 am and closes at 4:00 pm. This timing is according to the Eastern Standard Time, the EST. The trading reaches its highest levels during the start of the market and falls below at the lunch break which takes place from 12:00 pm EST to 1:00 pm EST. It is usually recommended to take advantage of the trading assets during the morning functionality of the stock market.
The stock market also operates in the areas other than the USA, most typically being Europe. The powerful stock markets located in Europe are termed as Xetra Dax and FTSE. The trading hours of these exotic trading markets start at about 7:00 am or 8:00 am EST and goes all the way till 3:30 pm or 4:30 pm EST, particularly on the weekdays.
The foreign exchange operates 24 hours a day and 5 times a week without lunch or any other break at different sectors and areas. There is not any physical operation of the foreign exchange but they do function in specific areas. These areas are:
The foreign exchange takes a complete round trip across the world and starts operating at valuable hours like the stock market. However, there are certain trading hours which are subjected to overlapping. For instance, London’s and Tokyo’s trading our overlap which is quite a big thing. Moreover, there’s an overlapping between the trading hours of London and New York as well which can be considered as a big deal as a significant amount of fluctuations may be seen.
Therefore, acknowledging every time zone can be a little harder and difficult for most traders. Thus, it is usually recommended to appoint a binary options trading broker for convenient investments in major assets and commodities, and much more.
Best Binary Options Brokers 2020:
Free Trading Education!
Free Demo Account!
Big Sign-Up Bonus!