Binary Options Trading On Commodities – Examples Of Effective Strategies
The problem of selecting a trading asset for binary trading lies in the area of profitability of contracts and the effectiveness of the investor’s operating strategy – each asset of the financial market is subject to a diversified influence factor, and shows the best possible profitability results during different time frames of trading and using certain types of strategies. Against this backdrop, we will devote our material to this area of commodities trading instruments for binary trading, as well as to the safe-haven assets of gold and silver. We will consider this set of financial instruments through the prism of effective trading systems that are optimal for working with this type of asset.
So, investors often consider oil the main type of commodity in binary trading. This trading instrument is today characterized by extremely impulsive price behavior and quote chart building. When considering the chart of oil pricing, you can see that the value of the asset has recently had a maximum level of volatility – over the past few years we have seen a deep decline in prices and long-term adjustments in the value of the asset. The main drivers of oil quote movement today are statistical and political news that determine the level of demand for the asset. Against this backdrop, the main and most effective strategy for binary options trading on this underlying asset is “Trading on the News“. This approach uses a very logical pattern that determines the behavior of traders on the market that trade on the quotes of this commodity asset – good news moves the market UP, bad news moves it DOWN. As technical signals to open market positions, we use statistical or political news indicators and the time of their publication. Here is a classic example.
Today, the hydrocarbon market is oversaturated with supplies of the resource, which significantly reduces the cost of the asset, so every news event regarding a reduction in oil reserves or a reduction in the number of drilling rigs is very good news for this market segment. Data of this kind is published weekly on informational resources, so investors can clearly find out from the announcements the times of such publications, as well as preliminary forecasts, and data from past publications – this is enough to conduct effective analysis on the data and register profitable trading contracts on the options market. It works simply, the latest data on a decline in hydrocarbon reserves moves the quotes of the asset sharply UP.
The binary options trader needs to quickly evaluate the statistics at the time of publication, and register a contract on a specialized terminal:
This method of working with commodities provides the maximum trading efficiency indicators, profitable contracts at the level of at least 90%, which opens up many opportunities for the trader. Trading contracts on oil quotes can be used as an additional means of making a profit, as a tool that diversifies risks and as part of the trader’s investment package.
Safe-haven assets – gold and silver
The quotes of safe-haven assets, in contrast to the price movements of oil, are not as impulsive. They are characterized by more measured fluctuations with the building of stable trends. Growth in the volatility of the price movement of gold and silver can be observed only during critical moments on the market, when the main trading assets cease to be attractive. These market conditions are created during periods of decreases in the value of major world currencies or after bold political statements from leaders of countries that have a global impact on the world financial situation. For this reason, these assets are referred to as capital preservation instruments. Against this backdrop, during moments of surges in volatility, it is recommended to work with binary options on gold and silver using the “Trading on the News” strategy. During other periods of trading, when the market is not subject to shocks, various trend-based strategies based on indicators work effectively. As a classic example of instrumental identification of the direction gold and silver quote movement, we can suggest an indicator strategy with signal efficiency of 90% that is based on the automatic MACD and Alligator algorithms:
This set of analysis tools utilizes simple and correct signals, in the form of an intersection of the Alligator lines and a break through by the MACD moving averages of the central level of the scale, to identify the most favorable asset price levels for the registration of options bets. Thus, investors can achieve effective trading – profitable contracts at 90%.
Binary options trading on commodities – the optimal trading conditions
Commodity assets and safe-haven assets in binary trading require investors to have certain technical conditions to increase their trading results. Here we can provide a professional recommendation regarding the choice of a professional broker – Binomo. This operator of brokerage services offers the most optimal conditions for trading on any kind of assets, as well as tools to build a huge number of strategies.
In particular, the company gives access to the following services:
- A set of trading assets – 80 items, including commodities, gold, silver
- Market analysis indicators
- Chart analysis tools
- Trading contracts with a level of profitability of 87%
- Expiration periods from 1 minute to 24 hours
- A non-stop trading format
- The minimum trading requirements – starting capital of 10 dollars, a minimum position cost of 1 dollar
With such trading and service conditions for binary trading, it is easy for the investor to get their planned result with complete technical capabilities and capital security.
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