Trading Forex Binary Options vs Spot Forex

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Trading forex binary options vs spot forex offers traders many advantages for both new and experienced traders. One of the biggest advantages is that when trading forex binary options, traders do not use stops. Because with forex binary options, the risk is paid on entry. Trading spot forex is attractive because it uses leverage to increase your profitability.

Leverage is dependent on the broker but is usually between What most forex traders do not realize until it is too late, is that forex brokers offer the higher leverage than any other markets. First, the trader opens an account and trades using margin to control a larger trade size. While this may seem great for winning trades, it also has a negative impact when the market goes against the trader. For example, in January the Swiss National Bank was scheduled to announce their rate statement at 5am New York time.

Although this market announcement does not typically create significant market volatility, they unexpectedly announced that the Swiss Franc would no longer be tied to the Euro. In less than twenty minutes, any currency tied to the Euro or Swiss Franc suffered huge losses most currencies suffered a drop of at least 1, pips and all spot forex was halted.

The ending result was that traders were left owing their brokers huge amounts and several forex brokers went out of business.

Forex binary options traders are never exposed to this type of risk. Is binary options the same as forex factory, they choose their risk on entry and that is the maximum amount they can lose.

Since forex is binary options the same as forex factory options limit the loss on entry, this provides the perfect opportunity for forex traders to trade any of the high volatile market reports. Plus, by using the forex binary options, I did not have to worry about the increased pip spread fee taking out my stop. For those that are unfamiliar with spot forex pip spreads, during volatile markets, spot forex brokers increase the pip spread significant and this can trigger your stops to be executed even when the market actually is moving in your favor.

The high volatility reports for this week are shown below, courtesy of Forex Factory. This provides traders with a definitive schedule of when they can expect high volatility. Now, instead of using margin to trade spot forex, I can plan my schedule around the calendar and simply invest in more contracts while limiting my risk using forex binary options.

Since traders can now plan their own schedules and still is binary options the same as forex factory risk, trading forex binary options vs spot forex make trading easier. A highly respected trader, trainer, author, and speaker residing in North Carolina. She has over 15 years of experience in trading and in the development of custom indicators.

She is a successful author and has published several books on topics like how to use volume analysis, trading binary options and spreads. The information contained above may have been prepared by independent third parties contracted by Nadex. In addition to the disclaimer below, the material on this page is for informational and educational purposes only and should not be considered an offer or solicitation to buy or sell any financial instrument on Nadex or elsewhere.

Please note, exchange fees may not be included in all examples provided. View the current Nadex fee schedule. Nadex accepts no responsibility for any use that may be made of these comments and for any consequences that result.

No representations or warranties are given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk and any trading decisions that you make are solely your responsibility.

Trading on Nadex involves financial risk and may not be appropriate for all is binary options the same as forex factory. Past performance is not necessarily indicative of future results. Nadex contracts are based on underlying asset classes including forex, stock index futures, commodity futures, cryptocurrencies, and economic events.

Trading can be volatile and investors risk losing their investment on any given transaction. However, the design of Nadex contracts ensures investors cannot lose more than the cost to enter the transaction. Nadex is subject to U. Fill out our online application in just a few minutes. New Opportunities for if Trading Forex Is binary options the same as forex factory Options vs Spot Forex Trading spot forex is is binary options the same as forex factory because it uses leverage to increase your profitability.

Planning Your Schedule to Include High Volatile Market Reports Since forex binary options limit the loss on entry, this provides the perfect opportunity for forex traders to trade any of the high volatile market reports.

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Thu Apr 12 Tokyo: July edited July in Binary Options Strategy. I will probably post some about Binary Options and Spot here and there as I notice good setups and trades. It particularly caught my eye and I began to read the thousands of posts from day one up until now. The core of the system is un-altered but I wanted to share and see if anyone wanted to try this with binaries.

I will attach the indicators in a following post. Dean Malone developed the TDI, but with this method there are several things removed from the original indicator. Green crosses red on the TDI and is heading up with a sharp angle think of the face of a clock, if the angle is in the 12pm — 2pm position , and PA agrees on the first or second candle of the move, enter the trade. Green crosses red on the TDI and is heading down with a sharp angle think of the face of a clock, if the angle is in the 4pm-6pm position , and PA agrees on the first or second candle on the move, enter the trade.

This only applies to Spot trading and not binaries since they have a fixed expiry. Now what I explained above is basically the core method, and some discretion needs to be used which is why I mentioned PA price action. For anyone new to this method, every single cross of the TDI will not result in a winning trade. Now to integrate this with Binaries, I think that if you look at a higher TF such as 30M and see a setup, zoom in to the lower TF such as 5M and look for a setup in the same direction to enter the trade on a 30M expiry.

Price action is waves inside of waves all the way up to the highest TF, so naturally if a higher TF shows a solid move then on the smaller TF you will have more obvious pullbacks that you can watch and wait for the continuation. The attached screenshots show where a Short put trade would have been taken. The entry is shown by a red vertical line on the 30M TF and when you zoom in to the 5M TF you will see you should probably wait until price starts to move again before you enter a Put.

Screen Shot at 6. During the evening if I trade, I usually focus on Spot Forex because if I see a setup on a much higher timeframe, I will usually set the trade with a stop loss at the most previous price swing point and go to bed. I usually do this with the 4H timeframe that way when two more candles develop and show up it will be morning time so when I wake up I can check on the trade.

Usually I will exit before I go to work, as I cannot monitor the trade throughout the day. As we all know or should know , if you look at a higher timeframe than the one you are entering your trade with, you will get a better idea of what direction price is heading.

If the highest timeframe shows a bullish move, I guarantee you every time frame below it will be bullish overall. The point is, if you trade in the direction of the higher timeframe price direction, your probability of having a winning trade is much greater. Focus on going with the flow if you are just starting out. Counter-trend trading should come later when you are more comfortable and accurate at entries and be fully aware that you are in a counter trend trade.

Counter-trend trades should be watched like a hawk for a sign of continuation so you can exit. The TDI indicator had an excellent crossover and the Stochastics was heading down, which confirmed my thoughts on where price was heading. If you look back at the overall trend you also see price is bearish, so this also adds to my trade. As I said earlier, I let the trade run all night, and when I woke up I checked again and exited my trade before I left for work.

Another reason I exited because if you look back in time around January of this year, price showed a significant support level and price bounced away from it, so price was likely to do it again. If you look at the 4 hour TF, I was correct that price would bounce off that significant historical support area so it was a good idea to exit before I went to work.

You can find the indicators by googling them, as i cannot upload MT4 files here. Screen Shot at Has anyone tried this out for themselves? Hey everyone, i made one BO trade this evening. I originally saw the move on the 30 minute chart so i zoomed into the 5M chart to look for an entry. The rules of the method were met, green crossed red at a good angle about 1pm , the Stochastics were heading up to add confluence. I entered on the second blue candle and not too long afterwards price had a small retrace then it took off again.

The reason i had confidence in this trade is because i had an entry signal on the higher TF and the lower TF. It's fairly simple as far as the method goes. There's not a whole lot you have to consider for an entry.

Price didn't do much for the previous several hours, so a large bullish movement like that had some momentum with it.

If the market is moving in a direction with decent sized candles, it will likely continue for some time. With the signals from this method, you should be able to catch some of that move early on. I have placed an arrow on the chart to show which candle i entered on, and as you can see, i could have added several other call trades as well in this move to maximize profits. I wish i had been at the computer the whole time, but i was eating supper.

Oh well, you cant catch all the moves. Please keep posting your progress. Sign In or Register to comment. Who's Online 2 2 Guests.