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Why Binary Forex Options are better than Spot Forex

  • #261
  • Jun 25, 2009 12:33pm Jun 25, 2009 12:33pm
Quoting giraia_br
"Dear Sir,

Thank you for your email. Unfortunately we do not offer daily one touch binaries, only monthly one-touches or the daily ladders, which is why you cannot see them on your platform."

BTW:

IG Markets, Inc. Client Services
311 South Wacker Drive | Suite 2650
Chicago | 60606 | www.igmarkets.com |
US Toll Free: 866 748 1340
International: 312 981 8010
Fax: 312 981 5050


what i do now?

i need to open a new account and choose England (they don't have Brazil) or it will be a waste of time?

thanks...
Mine is UK so can't see why you wouldn't get the full range as well. Send an email to the UK support team to check is the best way.
  • #262
  • Jun 25, 2009 2:25pm Jun 25, 2009 2:25pm
Here are three of the four trades I set up today. The fourth was a sorta straddle thingy but picked the wrong target by mistake. I decided to leave it on and, in the end, I only just missed the target by around 10 pips. Price then went back up and hit the top touch of the straddle @ 1.1410. Although I bought the touch @ 1.1410 I sold the 1.1430 touch as I had marked a resistance area @ 1.4025. Tight but good enough this time.

Overall a reasonable day but for the dumbass wrong trade. I didn't post them earlier as I didn't want them taken as signals with anyone risking their dosh on my calls.

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Click to Enlarge Name: bin_o Jun. 25, 2009.gif Size: 18 KB
  • #263
  • Jun 25, 2009 3:18pm Jun 25, 2009 3:18pm
One touch binary means if the price ever touched it once before expire, it becomes 100?
  • #264
  • Jun 25, 2009 3:34pm Jun 25, 2009 3:34pm
Quoting MoreYummy
One touch binary means if the price ever touched it once before expire, it becomes 100?
You've got it!
Bear in mind I work to fairly strict Support/Resistance markers on my charts so have a clear idea of what the potential targets are.
I also look at intermediate S/R areas and if they seem as if they might stop me hitting a primary area I'll look for touch offers around the intermediates.

I'm instinctively a trend trader in FX but am finding I can look at these short-term, sometimes counter-trend trades in BOs and see opportunities that I wouldn't have taken in FX. I never liked the idea of hedging in FX as it seemed a cop-out and tasted of a lack of firm decision making (that'll start a storm I guess) but I'm approaching these as simple counter-trend trades to near S/R targets while the main trades are waiting to play themselves out.

Apologies, that was a long-winded answer to your question.
  • #265
  • Jun 25, 2009 3:48pm Jun 25, 2009 3:48pm
A snapshot of how my chart looks and how I made my choices. The Buy to be above 1.3800 was a no-brainer for me on a non-news day. Not very adventurous but I'm not here to gamble but make money.

The lower Buy to touch 1.3880 should have been 1.3900 but I got careless trying to trade and talk on the 'phone.

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  • #266
  • Jun 25, 2009 8:35pm Jun 25, 2009 8:35pm
I have a weekly position open in GBP/USD. The order expiry is the 26th at 3 pm and its to close greater than 6225. I got in pretty early on this one and it looks pretty good. We've been in a range for the past couple of weeks and I've been playing that. Both in spot and binaries.
  • #267
  • Jun 26, 2009 3:56am Jun 26, 2009 3:56am
Anybody know how many $ per tick for the smallest contract? Don't have that demo anymore but I'm assuming they don't pay you a premium if you sell them correct?
  • #268
  • Jun 26, 2009 8:53am Jun 26, 2009 8:53am
Quoting saunga2nd3
Anybody know how many $ per tick for the smallest contract? Don't have that demo anymore but I'm assuming they don't pay you a premium if you sell them correct?
Its on the contract details, but if you dont have access. it might be on website i saw it before somewhere.
  • #269
  • Jun 26, 2009 8:54am Jun 26, 2009 8:54am
Quoting PeterFM
You've got it!
Bear in mind I work to fairly strict Support/Resistance markers on my charts so have a clear idea of what the potential targets are.
I also look at intermediate S/R areas and if they seem as if they might stop me hitting a primary area I'll look for touch offers around the intermediates.

I'm instinctively a trend trader in FX but am finding I can look at these short-term, sometimes counter-trend trades in BOs and see opportunities that I wouldn't have taken in FX. I never liked the idea of hedging in FX as it seemed a cop-out and...
thanks for the short answer

So if you Sell/Short it, if it touches the target price, your contract will be expired instantly, and lose?
If yes, it needs to know the S/R really well to play it, but sounds fun.
  • #270
  • Jun 26, 2009 9:19am Jun 26, 2009 9:19am
Quoting MoreYummy
thanks for the short answer

So if you Sell/Short it, if it touches the target price, your contract will be expired instantly, and lose?
If yes, it needs to know the S/R really well to play it, but sounds fun.
If you don't think a price will get to a target price then you Sell that BO. If price does touch it you lose.

I'm still playing about with different strategies but am probably still too Spot FX orientated.

I've got 5 trades running at the moment which I'll post after the close along with my thinking !!! at the time.
  • #271
  • Jun 26, 2009 1:57pm Jun 26, 2009 1:57pm
Mixed bag, but up overall. A couple of trades too far again, but 4 winners out of 6 and even the furthest target was in the money for a while.

The image is laid out with Red lines as losing trades; Green lines as winners. As I said the EUR/USD to touch 1.4130 actually carried a small profit as I bought it at 49.8 so as it got up to 1.1418 that's when I should have taken the money off the table. There's a couple of trades not shown on the platform image as they were closed when I captured it.

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  • #272
  • Jun 26, 2009 2:07pm Jun 26, 2009 2:07pm
Peter where do you trade at? I'm at nadex but i don't see these options.
  • #273
  • Jun 26, 2009 2:15pm Jun 26, 2009 2:15pm
Quoting ferndog
Peter where do you trade at? I'm at nadex but i don't see these options.
IG Markets UK
  • #274
  • Jun 26, 2009 2:33pm Jun 26, 2009 2:33pm
if you open a position to long E/U
when you buy 1 touch 1.411 contract

will it generate same profit if take profit and close position when E/U 1.411 is reached?

the oanda box option does not seem to be more attrative than spot.

Quoting PeterFM
IG Markets UK
  • #275
  • Jun 26, 2009 3:07pm Jun 26, 2009 3:07pm
Essentially each trade has a nominal value between 0 & 100. When you enter the trade each option is priced somewhere between those two numbers.

A 50/50 bet would be priced at something like Sell 46-Buy 52 ( the spread on these is crap btw). So in my case when I took the touch @ 1.4110 I bought 1/2 full position @ 79.7. At that time the market prices this as having 80% chance of hitting the strike price.

These figures may or may not represent a true reflection of where price may go. I base my trades on my vision of the main trend (Daily/4 hr), my own estimation of support & resistance.

If the strike price is hit then the bet settles at 100, so in this case I made 20 X 0.5 position size. If it doesn't then it settles at 0 and you lose the premium you paid to enter the trade. That premium is all you can lose. You can also close any trade at any time when it's in the money and this is what I should have done with the EUR/USD to touch 1.4130 trade but I'm a let-it-run man normally so didn't close even when I began to suspect it wasn't going to make it.

The reason that actually got in the money was that I bought it @ 49.8 and as price got above 1.4110 the market went to (I think) around 80 so I was 30 points or so to the good.

I've found that this isn't complex, it just needs a different approach and I'm still finding my way a little but I'm still 2% up even after a massive hit on a couple of spot FX plays I made. Strictly on the BOs I hit 86% win rate so if I hadn't f**ked about on the spot FX trades I'd a been well ahead.

Not sure if this is the answer you were looking for, but anyone who knows me knows that I don't do short answers .
  • #276
  • Jun 26, 2009 3:13pm Jun 26, 2009 3:13pm
thanks a lot peter for the patience & explanations.
I think I need some homework to calc,,, I will collect some data offline 1st...

but here is the brief idea:

problem is when it don't hit in one day(?), it's 100% loss.

so even if we're 90% sure it can hit the price,
longing the pair may profit when it hit and may lose not all when it miss...

possibly you can calc if the contact price is under it's real value
coz diff people have different view/estimation of future and can cause contact price to be under valued.

Quoting PeterFM
Not sure if this is the answer you were looking for, but anyone who knows me knows that I don't do short answers .
  • #277
  • Jun 26, 2009 3:37pm Jun 26, 2009 3:37pm
Is there any account minimun to open? In Nadex.com i mean?
FF = Forex Faggots
  • #278
  • Jun 26, 2009 3:39pm Jun 26, 2009 3:39pm
Quoting 8fingers
Is there any account minimun to open? In Nadex.com i mean?
$100 min

Anyone know if the Oanda box options worth trading?
  • #279
  • Jun 26, 2009 3:52pm Jun 26, 2009 3:52pm
Quoting billye
thanks a lot peter for the patience & explanations.
No problem.
Quote
problem is when it don't hit in one day(?), it's 100% loss. so even if we're 90% sure it can hit the price, longing the pair may profit when it hit and may lose not all when it miss...
Exactly, but if you choose carefully and you have any experience intra-day trading then it becomes a little easier. Loss is a part of any trading experience and I have learned to accept that without emotion. All I try to do is look for trades that appear to have the best chance of success and make my play. If it wins OK and if it loses that's OK too.
Quote
possibly you can calc if the contact price is under it's real value coz diff people have different view/estimation of future and can cause contact price to be under valued.
It's the same as any other trade. You and I can look at a possible trade and end up with a different view of what the outcome could be. I might take the trade, you might not see the same value in it and give it a miss. One of us will be right and until I close the trade we won't know which of us made the best decision.

There are monthly BOs as well but I haven't tried them yet.
  • #280
  • Jun 26, 2009 4:25pm Jun 26, 2009 4:25pm
Here's a clue as to how I assess my charts. In the main image I have set my Support and or Resistance lines. At this point my bias for Fiber is long (this may change as Monday develops) so I start off by looking for strikes that I feel are protected by support.

I add these to my watchlist. As the day develops the market's bias should become fairly clear. If I still feel good about the Support (and I use price action as a guide) then my largest positions are placed on these types of trades. In this case I BUY the option to close above the strike price as I look for Support to be tested but not broken.

As the day goes on and I sense the market has a definite direction to it I will look to buy with-trend touch trades but usually reduce my position sizes with these.

If I have a strong Resistance area in mind and the market is moving with no great momentum then I may consider Selling a touch or a close above, depending on the nearness of the strike price and the options price.
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