When the matter come to the prediction of market movements, there are several different means one can rely on. One of them is viewing a lot of charts and applying different types of technical analysis. The other involves keeping track of what is happening in the global economic and political world.
Most people rely solely on the first when using profit-amplifying solutions, not knowing that the second method is also quite good and at times can be even more accurate. Binary options news trading is actually quite easy, if one keeps regular track of all important current happenings.
A fine example of this would be if a large company like Apple or Hewlett Packard was releasing a new product. Usually, this would mean that its assets’ price will rise drastically and then begin to slowly decline after the initial hype has passed.
How to Get Started?
One can begin by finding out which investment strategies involve the use of binary options news trading. There are a handful of popular methods, the best of which are:
Breakout Strategy: This trading method requires users to carry out a lot of preliminary research as they have to identify which the most crucial economic events are during a given period of time. They could concern a major release from a prominent corporation like the one mentioned in the example above. It can also be a local happening such as presidential or parliamentary elections which could affect a particular currency pair. From thereon, online investors have to predict the correct asset shift within a given time frame and choose their entry and expiry points wisely.
Volatility Technique: This one is even simpler to execute that the Breakout Strategy. Traders have to watch the binary options news carefully for indicators of sudden and drastic shifts in price directions and then be quick to place just the right investments at the exact time. The Volatility Technique focuses on the importance of one’s ability to make speedy decisions.
Asset-Price Rebounds: It is actually quite common for a sudden event like Britain’s decision to leave the EU to stir the financial world a little bit. When something like this occurs, asset prices usually begin to rapidly rise or fall, but after a couple of months pass they return back to normal. Investors can make good use of this by either placing a trade right when the event has happened or a long-tern option when it has already begun to settle.
No matter which trading strategy one prefers, keeping track of important events is always good when commencing to indulge in binary options news trading. This is especially essential for people who prefer the manual mode and for ones that open accounts mainly with broker platforms.
Beginning to Apply Binary Options News Trading
Users who have already invested with a binary options system or broker will know that some of them provide an Economic Calendar which will most likely alert them of all crucial upcoming events. However, even if this is not the exact scenario, one can always keep himself informed just by opening a financial website.
They usually have the most extensive information on which the most important upcoming events are. If this is one’s first time trading binary options with the use of news, then he or she should just focus on analyzing what would be the aftermath only of relevant and truly significant happenings.
Novice traders must not try to predict how a small local event might have an effect on the market as this might distract them from seeing the big financial picture. So, they should concentrate on it and let the details get tweaked out along the way.
What Makes Binary Options News Trading Profitable?
Financial and political events that might have a significant impact on the way markets move usually follow a couple of established patterns. There is some room left for surprise, but every online investor knows that trading involves a bit of speculation.
One learns to recognize the said motifs and patterns he will easily know how to successfully implement them into his everyday investment strategies. Users should try and stay as emotionally detached from the event as possible in order to make the best out of the opportunity to turn the tables to his very own advantage.
How to Pick the Best Binary Options Trading News?
It is not hard to tell which event is more relevant than the other. At first this might appear to be quite difficult as not every user is interested in political matters, but since they are proven to affect asset prices he will have to get used to the fact that this is necessary.
If one focuses only on significant happenings at first, he will easily find out how small-scale ones can have an impact on more minuscule market sectors later on. One should not ignore the latter as he can achieve success investing in them in a smooth and satisfactory manner because most people seem to ignore the profitable opportunities they offer.
Did You Know?
Many successful traders operating not only in the binary options field have managed to accumulate considerable monetary amounts just by paying close attention to what goes on in smaller market sectors. Even Apple was once a company of no importance, but the ones who kept track of the news and knew the visionary concept of the future that Steve Jobs had, managed to make good profits thereafter.
All of this makes binary options news trading highly profitable. It is easy to predict how an election or cold winter might affect the prices of a given commodity or currency pair. Which enables the user, without view if he is novice or skilled, to place and execute successful trades.
Drawing the Line on Binary Options News Trading
Carrying out binary options news trading is one of the best ways in which one can make solid profits online with little effort. It would be a little bit complicated at first, of course, but once users master the art of separating the truly important events from the rest, they could easily apply these types of strategies.
As they mature and evolve their investment skills, they could even commence to do options trading in areas and with assets that are not so popular and achieve great success in doing so.
All in all, it is a good practice to keep track of the news or the Economic Calendar of the binary options system or broker one has opened an account with. Even if it is just to keep oneself informed of the latest tendencies and patterns in the online investment sphere.
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1. The boats that did not sail. News, trading and asset price volatility in a natural experiment (Peter Koudijis – Job Market Paper, 2010)
2. High-frequency trading and price discovery (Jonathan Brogaard, Terrence Hendershott – The Review of Financial Studies, 2014)
3. The impact of salient political and economic news on the trading activity (Yue-cheong Chan, Andy C. W. Chui – Pacific-Basin Finance Journal, 2001)
4. To trade or not to trade: The strategic trading of insiders around news announcements (Adriana Korczak, Piotr Korczak, Meziane Lasfer
5. What defines ‘news’ in foreign exchange markets? (Kathryn M. E. Dominguez, Freyan Panthaki – Journal of International Money and Finance, 2006)
6. Speed, algorithmic trading, and market quality around macroeconomic news announcements (Martin Schoultus, Dick van Dijk, Bart Frijns – Journal of Banking & Finance, 2014)
7. The relationship between the frequency of news release and the information asymmetry: The role of uniformed trading (Takeshi Yamada, Jianfeng Shen – Journal of Banking & Finance, 2013)
8. News and dollar exchange rate dynamics (Massimo Tivegna – Rivista Italiana Degli Economisti, 2002)
9. Reading all the news at the same time: Predicting med-term stock price developments based on news momentum (Michael Hagenau, Matthias Hauser – System Sciences, 2013)
10. Enhancing automated trading engines to cope with news-related liquidity shocks (Sven S. Groth – European Conference on Information Systems, 2010)