The accrual of a premium on an investment in binary options for most types of contracts depends on a sharp price change. The most popular underlying asset for these instruments are currency pairs Forex, which are traded in the format 24 hours and five days a week.
The activity of trading participants within the day is heterogeneous and can lead a trader to a series of unprofitable transactions that do not depend on the correctness of the forecast. This axiom is true for the entire line of underlying assets, many of which are traded for 8 "exchange working hours".
Basic movements and trends in the markets of commodity and financial instruments are associated with the working hours of world exchanges – centers of attraction for the masses of speculators and institutional investors. Since all assets are correlate with each other, a binary options trader can empirically determine common patterns and independently choose a time interval for transactions
The main trading sessions of the world of finance
The opening of US exchanges leads to most significant movements in the market, since this territory accounts for the majority of international financial centers of trade and funds. The first signs of activity appear at 15-30 or 16-30 Moscow time, if economic news.
Starting from 17-30 to 21-00 Moscow time, a large influx of funds and transactions come to the markets, a binary options trader can count on trends for 100% during this period.
European exchanges start working from 10-00 Moscow time, and Asian financial platforms are closed at 11-00 Moscow time. Binary options can be purchased until 14-00 Moscow time, but with an adjustment for 50% of the activity of trading participants from Europe, in comparison with investors and speculators of the New World.
The Asian session is often excluded from the trader's work, due to the low volatility and geographical time difference – most investors are resting during these hours. Activity is observed only in national currencies and instruments related to the markets of the Asia-Pacific region, if in the economic calendar contains news.
Sometimes traders use the low volatility of the "Asian" session to trade binary options of the type " Inside Range" or spread. This trading tactic is called "night trading".
Binary options brokers provide an opportunity to trade on weekends, despite closed markets:
- random underlying assets;
- a certain set of instruments for over-the-counter quotes;
Random indexes are relative values obtained during the solution of the algorithm. The trader cannot verify the time series for which fluctuations occur, since the broker makes calculations independently. It is not recommended to trade such openly biased instruments, since they are not amenable to analysis.
OTC quotes can take biased values, they are difficult to check and predict, therefore, for the same reason as above, you should refrain from transactions.
Cryptocurrencies are traded on weekends, but since these are the only working markets, the activity of traders is low, which leads to a high error technical analysis.
Traders who use shares of enterprises as a base asset are guided by the opening hours of the stock exchanges on which they are placed. If it is London (LSE) or Frankfurt (FWB), then binary options are available from 10 (11) -00 Moscow time to 18-00. This period is divided into two parts, with a lunch break from 14-00 to (15-30) 16-30, depending on the availability of economic news. The activity of the US stock exchanges starts from 17-30 to 21-00.
Stock index futures
Futures on stock indexes are traded around the clock, after electronic trading became available online platforms. Due to the fact that the quotes of these derivative assets are associated with the indices of exchanges that work 8 hours a day, are low-volatile during "non-working hours".
Brokers are aware of this effect, so they often "close" binary options trading on such assets before the exchanges open. If the trader manages to get access to them during the entire trading day, then the purchase of contracts for stock index futures is carried out according to the rules strategies "night trading".
The economic calendar is the publication of dates and times, as well as the expected value of macroeconomic indicators. In addition to these data, the calendar shows political events, speeches of the heads of Central banks and states, international economic summits.
Every trader is obliged to familiarize himself with the calendar schedule for each day and week in order to know the date, the exact time of release and the importance of news. Significant events increase volatility in the markets regardless of the time of activity, but they introduce a high percentage of uncertainty into the forecasting process.
Despite the pre-calculated value of the indicator, the analysts ' data may differ from the published statistics, which will cause the expected reaction of the bidders to be reversed. If a trader does not use a trading strategy "on the news", you should stop trading binary options 10-15 minutes before and after publication.
Of particular importance are the dates of holidays in the United States or developed countries associated with the traded underlying asset. The absence of "big money" in the market will make all trading intervals look like an "Asian session".