Currency and financial market require not only experienced but also a large deposit. Binary options allow you to get a stable profit and with a minimum of investment on ready trading signals. But before we tell in detail how signals work for binary option let's see what types of signals are the most popular.
The term “binary option” is not very well chosen. An option in its classical exchange sense means a contract under which a potential buyer/seller receives the right to purchase/sell a certain asset (commodity, security, futures) at an agreed price and at a certain point in time. A binary (or digital) option, depending on the fact that the conditions are met at the set time, gives a fixed income or does not bring it, but does not provide for the right to act with any financial asset.
That is, a binary option is not derivative security, but is a simplified version of the contract for difference (CFD).
We classify options by the following parameters
Rise/Fall (CALL/PUT, Cash-Or-Nothing )
Binary options trader should predict the direction of price movement and open the option either for an increase or a downgrade.
When you determine your forecast, choose «CALL» if you think that the price of the chosen asset will rise, or «PUT» if you see the prospect of its falling. The amount of profit is agreed in advance and specified by the broker in his offer, usually in the range of 75-85%. If the forecast is wrong, the broker can make a partial return on investment-10-15% (on weekends, holidays and during an inactive market, the amount of payments on unprofitable transactions changes).
The expiration period of such options in a wide range: from 5 minutes to 365 days, especially since some brokers allow them to sell these options before their expiration. This makes it possible to reduce the possible loss (and sometimes even make a profit!), but not more, in advance of fixed income.
Higher/Lower barrier (Digital Barrier Option)
If the price of a trading asset at expiration time will be strictly higher (or strictly lower) than the option set at the opening of the barrier will be profitable. The further away from the barrier from the current price (towards your forecast, of course!), the greater your possible profit. But do not forget - the probability of receiving it also decreases in proportion to the size of the barrier.
The option ends in profit when the price touches/not touch the specified barrier, which can be above or below the opening price.
«One Touch» allows for the same time to earn more than the classic options with fixed expiration. As soon as the price touched the barrier, the transaction is closed and in the binary trading platform, you can open a new one for the profit received. You can also use news strategies when you're more likely to move the price one way after a fundamental event release and additionally and after a one-touch profit you can open «No Touch» against the trend.
Importantly, brokers often do not allow you to set a barrier far from the current price or reduce profits on them to 45%-60%. Beginners should start with the classic types of option and only with the experience to add barrier binary options signals!
If in the previous two types touching the barriers didn't matter, in the following it depends on how the option ends:
Important: during the release (see the calendar!) financial news, most brokers for 5-20 minutes before the news and as much of their output block access to the option "60 seconds".
But, there are clear time limits - usually, such a transaction is opened for a minimum of 30 minutes, and a maximum for it is 4-5 hours.
Recommendations about use …
Last recommendation: for any type of option, it is important to choose the right broker. It depends on how quickly the position will open/close and therefore profit.