The binary option is a financial instrument that can allow you to make significant profits in less than an hour. Over the past few months we have been hearing more and more about binary options trading and people using this financial instrument are reporting big profits; the main reasons for this are the simplicity of trading and the possibility of earning 75% in less than an hour.
If you don’t know what binary options are, the name itself should tell you something about the meaning of binary options, as in the binary code that only uses 2 digits “0” and “1” in the binary options trading, you have only 2 choices:
1. Prediction that the price of an underlying asset will rise: This is called the binary call option.
2. Prediction that the price of an underlying asset will fall: This is called the binary put option.
The fact that the trader has only 2 options “Call Option” or “Put Option” makes things much simpler, a trader does not have to predict which asset will give him the best profit or how much it will go up or down, what it has to predict is only the direction of the market price of the assets, in other words, it has to predict whether the market price of a certain commodity, stock, index or currency will rise or fall during the time that elapses between when he bought the option and its expiry time (in most assets, traders can choose between an hourly expiry time and a daily expiry time.)
Another different thing that makes binary options such a popular financial instrument is the huge payoff, when trading binary options the profit you get on a successful prediction is 75% which is extremely high compared to other forms of investment such as Forex.
So, regarding the main question, how do you improve your chances of predicting whether an asset’s price will go up or down?
One of the most important rules in binary options trading is to choose the assent for your investment, the more you know about the asset the more likely you can predict its direction, try to read some information about the active before buying an option. Knowing more about the background and industry of the business will tell you a lot about what might happen the next trading day or hour.
Another thing that might be useful is to read past charts, but you should be careful because sometimes things change quite quickly, even a stock that drops 5% in one day, can go up if there is a reason to. this and sometimes even for no particular reason.
Another important thing you can do is to read the financial news; websites like “Yahoo Finance”, “CNN Money” and “Financial Times” can give you a good analysis of the market, it will help you to predict whether the direction is up or down.
Another source of information can be binary options trading sites. On some sites like GlobalOption.com, you can find daily tips that will help you in your prediction.
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