Beginners guide to the best time to trade binary options: timing for stocks, timing for currencies, timing for commodities and timing for index futures. Here you will find important tips that will show you how to be successful and start your career at online binary options trading.
As a beginning you should know that binary options trading involve several assets that you will be trading and eventually be making money out of those trades. All you have to do is to predict the price direction. You can choose on what basis to trade the assets – most of them are traded on 24-hour. You can choose between stock indices, currencies, commodities. Usually the stocks are not traded on 24-hour basis. The reason for this is because there are different time zones and this is why there are different trading hours all over the world.
Best Forex Brokers for United States
Typical for the market of binary options trading is that the trader makes money based on the volatility of the asset and its prediction whether the price will go up or down.
Actually this type of trading is gaining huge popularity because there are people all over the world who are trading 24/7. And as you know, when the market is bubbling and when there is a good trading activity, this means that the volatility and liquidity is generated before the expiration of the option.
Even though commodities and currencies are supposed to be traded on 24-hour basis, there are certain times when the market works at its best. Usually these times are the ones when you have to overlap the difference between trading zones.
Not all assets have the same trading hours and this is why there are various assets classes that are taking into account their own trading hours.
Timing for Stocks
Usually stocks are traded 6 to 8 hours daily. The most major stocks of US based companies are traded on the US stock market and go by the abbreviation of ADR (American Depository Receipts). This is why the United States market is usually used as the checking benchmark of the trading hours.
However, the US market is not the only one – there are other markets in Europe which are also important. Such market is FTSE (it works 7AM GMT to 3.30PM GMT), another market, based on Germany is Xetra Dax (8AM GMT to 4.30PM GMT). It is really important to pay attention to the markets and their working times.
Timing for Currencies
The time in which the Forex market is most active is between the overlap of the Asian/London and New York/London time zones. The image below shows this time.
Another thing you have to keep track on is the volatility of the local markets and the local currencies. For example, the Australian dollar will have high values during the overlap of Asian/London time zone.
Timing for Commodities
As for the commodity markets – they are active during these times;
NYMEX.CL (Crude Oil) – 9AM EST to 2.30PM EST
Silver – 8.25AM EST to 5.15PM EST
Natural gas – 9.30PM EST to 5.15PM EST
Gold – 8.20AM EST to 5.15PM EST
Corn – 9.30AM EST to 1.15PM EST
Another good way to study all those times is to group all commodities by the exchanges they are traded under. This means that the agricultural commodities (traded in the Chicago Mercantile Exchange) will be more active from 9;30AM to 1;15PM EST.
Timing for Index Futures
You have to know that stock indices are CFD instruments and they are measuring the movements of the exchanges. Such indices are NASDAQ100, S&P500, DJ30. All of them are traded on the US market and are active from 9;30AM EST to 4;30PM EST.
Remember that it is really important to master the trading hours of those assets because this will take you one step closer to profits.