Every active person constantly strives to optimize their activities and ensure maximum profit with minimal time, energy and financial resources. Binary options trading as a type of remote earnings is no exception, because traders try to use various indicators, Expert Advisors, robots and other technical tools to facilitate their own work. Another help for binary contract traders are option trading signals, which work on the basis of technical analysis, indicators, charts.
Features of signals for options trading.
When trading signals, it is necessary to take into account the patterns that have developed over many years of trading on financial exchanges. One of these patterns is the uniformity of forecasting for all stock indices. If the forecast “Actively sell” or “Actively buy” is indicated on all timeframes, then this is a sign of a strong and reliable signal not only for a particular asset, but also for the entire market as a whole.
The reason for the appearance of such signals is not a simple accident, but the publication of a number of macroeconomic news bearing a positive character. In this case, the market as a whole assumes an active purchase. Having received such signals, you can immediately start buying the selected asset.
The main advantages of options trading.
There are three main advantages of option trading:
- Firstly, options can be used to generate fixed income. When we sell options, we get a premium.
- Secondly, options can be used to insure their investments. In fact, this is the original reason for creating contracts of this type.
- Thirdly, options belong to the class of derivative instruments, which makes it possible to analyze prices not only and not so much of the underlying asset (stocks, cars, food, etc.), but also to analyze changes in derivatives of these assets. In the case of options, the first derivative is volatility, forecasting changes in which is an order of magnitude simpler than forecasting the prices of underlying assets.
An important consequence of the above properties of options is that option trading noticeably — a) increases the potential profit/risk ratio; b) reduces the requirements for the quality of forecasts — if trading is not “naked options”, but various combined strategies are being developed.
Another advantage of signals is not just forecasting the direction of the transaction, but also their more accurate interpretation. Each signal provides information about the asset, the direction of price movement, the entry point and the recommended expiration date. Signals are a useful tool that allows a trader to get additional information about the market, which will help in his analysis and in making a profit from trading binary contracts.