Binary Options are regarded as one of the easiest ways for a trader to make money. All that a trader has to do in this type of trading is predict the outcome of the price of whichever asset they choose. For example, if the choice of asset is gold, a trader has to predict whether the price will increase, decrease, or stay within a predefined limit.
If their prediction turns out to be correct they receive a defined amount of profit, and if they are wrong, their initial investment is lost. The surety of knowing the exact amount of profit and loss is one of the biggest appealing qualities of this trade. However, traders can further minimize their risk of losses by implementing certain strategies and using some tools. One of the strategies they can use is to have a full grip on the best time to trade binary options.
Do you want to know how to choose the best trading times and the best timings for the trade of binary options? Keep reading this article till the end to find out.
Why Is Knowing the Best Time for Trading Binary Options Important?
Because binary options and stock exchange are so similar, many people get them mixed up. The most notable difference between these two is that the stock exchange can only be done for a limited time. However, binary options may be traded 24 hours a day, seven days a week. Even though they may be traded 24 hours a day, seven days a week, they are still affected by time zones and market volatility.
Stock exchanges have many different time zones. However, three of those time zones are the most active, the Japanese stock exchange, the American stock exchange, and the British stock exchange. As binary options are a type of stock exchange, they are the most active in the designated time interval, although they can be traded 24/7.
For instance, suppose you live in the United Kingdom and work in the American stock market time zone. As a result, trying to trade in the British exchange at that time will be fruitless. This is why it is critical to remember the multiple time zones associated with your asset to maximize your profit.
Another reason for you to know the timings for trading binary options is for the volume of the traders and the trade at that point in time. The volatility of a market does not only mean a sudden fall in the price of the asset but also a sudden rise in the price of the asset. Hence, to be a pro at trading binary options, you should be aware of the times when the market is the most positive.
As stated above, there are three top stock exchange time zones. The overlap between these three time zones is possible. So if the number of traders reduces due to the overlapping of time zones, the volume of traders will be reduced as well. Hence, it is important to know the exact time for the asset you are trading, as the more the volume of traders, the more the profit will be.
The Best Time to Trade Binary Options
After you have fully understood why choosing the best time for binary trading is important, you would want to figure out those best times. However, it is understandable if you are confused based on the fact that how can a best binary trading time be fixed if we are unaware of everyone’s trading choice? This is because some prefer trading when the market has a high volatility, and some prefer when it has a low volatility.
This is why all the timings that are being fixed are based on these two strategies. During the night, the volume of the respective stock exchange generally remains lower, and during the day, it rises. However, the best time to trade is considered to be that time when the market has the most active traders. That is when the market is volatile. Based on different assets, let’s find their best time for trading.
Forex exchange has four important trading markets, namely Sydney, New York, Tokyo, and London. Although it can be traded 24/7, the best time to trade Forex is when there is an overlap between any of those timings. The overlap between Tokyo and London and New York and London is considered to be the best. Tokyo and London markets are active from 8:00 to 9:00 GMT, and New York and London markets are active from 13:00 to 17:00 GMT.
For the trading of commodities, the best time to trade is when the markets are active. Every commodity has a different time for which its market will be active. For example, precious metals such as gold will be active from 8:30 to 17:00 EST, and natural gas and oil are the most active from 9:30 to 15:00 EST. In the same way, agricultural commodities are the most active from 9:30 to 13:15 EST during the CME hours.
