Unlike trading just individual shares of stock where investors may only execute orders during certain days and hours of the week, those who trade in the binary options arena have a much more extensive ability to trade at nearly all hours of the day or night, as well as on the weekend. When trading these financial vehicles, binary options traders may choose from a wide variety of different underlying assets on open markets worldwide – which can also help them in trading a number of assets simultaneously.
Holiday Trading Times for Binary Option Markets
While not all holidays are celebrated worldwide, there are certain markets that observe specific days by either closing entirely or by reducing their trading hours on specific dates. For example, the major holidays that are observed by both the Metals and the Forex markets in the U.S. include:
- Good Friday
- Memorial Day
- Independence Day
- Labor Day
- Thanksgiving Day
- Christmas Day
- New Year’s Day
With this in mind – and because there are traders worldwide that access these markets on a regular basis – it is a good idea to be mindful of which holidays are celebrated by the various binary options markets, as this could have an effect on certain trading positions.
Organising your binary options trading schedule
Depending on where you live and the work schedule that you have will determine when you want to trade binary options. Some markets are, however, better traded at certain times and it is good to have an idea of this before setting out your trading day. Binary options in the traditional sense simply look for opportunties where the markets will be higher or lower after a given period of time. For this reason alone it is important to know which markets are likely to be the most active and effective for your trading needs. For those traders keen on trading individual stocks or indices, this is obviously going to be during market hours. Those who already work during these hours, however, may want to consider trading a non-local market before or after work, effectively utilising the 24 hour nature of global trading. Alternatively, currencies can be traded 24 hours per day although many of these have quiet periods during the non-market hours where they have large spreads which makes them difficult to trade in the traditional way. By using binary options, however, there is still sufficient volatility to make considerable profits during these periods.
Binary options are one of the easiest ways to trade in that they actually require no maintenance of the trade once a position has been taken. This is because the potential profit and loss has already been ascertained prior to the trade and the expiry time set. Few traders will benefit from watching the trade close unless there is the opportunity to close the position early, therefore binary options can offer an ideal “set and forget” trading system. The provision of mobile trading by many platforms also makes this increasingly possible and may significantly reduce the time required in front of the screen.
Timing Binary Options Trades
For those investors who opt to specialize in certain types of underlying assets, profits may be boosted by choosing assets that overlap in terms of their available market trading hours. For example, traders who invest in just one asset may essentially be limited to only the hours of that particular asset’s market. However, in order to open up more profit potential, choosing a second asset that trades on a different exchange can allow that trader additional market trading hours – essentially leaving no dead trading periods. And, because investors are able to trade binary options on nearly any type of underlying asset, they are able to read more broad market signs, easily giving them the ability to profit 24 hours per day.
The Best Times to Trade Different Binary Options
Although different underlying assets may trade at various times throughout the day – some even trading on 24-hour markets – there are certain periods where activity may be more or less advantageous for particular traders. For example, in many cases, trading works better when the market is ripe with activity from traders across the globe. This is because a high amount of trader activity will typically signal that there is both volatility and liquidity that is required for the underlying assets to hit their target prior to the options expiry.
Assets that trade on various stock indices will have particular periods of high activity. Markets that are located in the United States, for instance, generally trade between 9:30 am to 4:00 pm EST. However, there are stock markets in Europe such as the Xetra Dax and the FTSE in UK that are equally important. These markets typically trade from 7:00 or 8:00 am to 3:30 or 4:30 pm GMT. Therefore, traders should be well aware of the most active market times for the particular underlying stock shares that they are trading in. This also holds true for those who are trading in the futures indices.
Likewise, timing the currency and commodities markets is also essential for those who trade in these areas. Here, the Forex market tends to be the most active when there is an overlap in the London/New York and the London/Asian time zones.
In any case, once traders have mastered the available trading hours for each of the underlying assets in their focus, it is much easier to move towards potentially profitable trades in these different yet related areas.