Why Binary Forex Options are better than Spot Forex | Page 22 | Forex Factory

Options

Go to
Permalinks
Print Thread

Similar Threads

Nadex trading binary options, you better be losing money on that 3 replies

Multi Time Frame Analysis for Spot and Binary Options 457 replies

Rekon Xs and Market Scanner for Spot and Binary Options 442 replies

Spot Forex vs CFD Forex: Are we really trading Spot? 11 replies

show me one advantage of binary options over spot forex 16 replies

Attachments: Why Binary Forex Options are better than Spot Forex
Exit Attachments

Why Binary Forex Options are better than Spot Forex

  • #421
  • Jul 25, 2009 5:10pm Jul 25, 2009 5:10pm
Quoting Coach1959
Excellent job cmoon . Best wishes for your success trading your live account.

Coach

Thanks coach I just wanted to show it is possible to do well with Binary options as well as spot. In fact i am a lot better at binaries than with spot forex. I treat them the same ways as I handle verticle spreads and Iron Condors with standard options.

Thanks again! and a big thanks to everyone for starting and keeping this thread going.
  • #422
  • Jul 25, 2009 5:34pm Jul 25, 2009 5:34pm
Quoting cmoon10
Thanks coach I just wanted to show it is possible to do well with Binary options as well as spot. In fact i am a lot better at binaries than with spot forex. I treat them the same ways as I handle verticle spreads and Iron Condors with standard options.

Thanks again! and a big thanks to everyone for starting and keeping this thread going.
Your welcome. Would you mind expanding a little on how you treat binaries the same as your verticle spreads and Iron Condors? A little insight may be helpful, if you are comfortable sharing.

At this point I am still MUCH better at spot forex than binary options. I have only traded binaries for a week versus three plus years of spot, so I have a lot of room to grow. However I think binaries have a lot of upside potential.

Thanks

Coach
  • #423
  • Jul 25, 2009 5:46pm Jul 25, 2009 5:46pm
Quoting Coach1959
Your welcome. Would you mind expanding a little on how you treat binaries the same as your verticle spreads and Iron Condors? A little insight may be helpful, if you are comfortable sharing.

At this point I am still MUCH better at spot forex than binary options. I have only traded binaries for a week versus three plus years of spot, so I have a lot of room to grow. However I think binaries have a lot of upside potential.

Thanks

Coach
I trade pretty much the same way Dreamliner does. I put the odds in my favor and I enter with the overall trend of either the GPD/USD or EUR/USD. So If the trend is up I will buy and if it is down I will sell. Aside from having to deal with Margin this works very similar to selling vertical option spreads, in the sense for me it is the same mind set even though you go about it a little differently. Imho the key for me to do well with binaries is managing the trade well. Just like when selling standard options, dealing with binaries in this way gives you a horrible risk/reward. This is the trade off for putting the odds in your favor and the key to doing well is to be able to cut losses quickly as one big loss can wipe out many profitable trades.


Hope this helps!
  • #424
  • Jul 25, 2009 6:08pm Jul 25, 2009 6:08pm
Quoting cmoon10
I trade pretty much the same way Dreamliner does. I put the odds in my favor and I enter with the overall trend of either the GPD/USD or EUR/USD. So If the trend is up I will...
Yes it does help. Actually this week I did much better when I traded the binary when it was 1-3 hours before expiration. I traded price points from between 85 and 95 points where I stood to gain only 5 - 15 points profit. You know, in the traditional sense, we say that is a high risk trade because it has poor risk to reward. I look at it as we have a very high probability of the trade closing for 100. You can always monitor the trade and close if it went against you way before it would ever hit 0. Say you had a 5k account. You could trade 5 contracts, make 10 points, and profit $500... on one trade!!! At this point, I think I could be happy with that, cha ching.

Coach
  • #425
  • Jul 25, 2009 6:13pm Jul 25, 2009 6:13pm
Quoting Coach1959
Yes it does help....
I can not agree more! I think by putting the odds in our favor we are more like the casino instead of the person playing against the casino. Then just multiply your profits and all the way to the bank. I will look into trading in the 1-2 hours before expiration, I think it is a good way to trade.
  • #426
  • Jul 25, 2009 6:25pm Jul 25, 2009 6:25pm
Quoting PeterFM
Yep, we have IG Markets in the UK and as there are tax and stamp duty benefits to this type of trading I suspect it's where I will end up.

In addition there are several spread betting brokers but they are a different kettle of fish and not my first choice. The tax advantages still apply but as I understand it are more like bookmakers (many of them started out that way) and are trying to 'round' their books by price manipulation, allegedly. Some of them even offer odds as per a bookie. I don't think you have this style of borker (spread-betting)...
Hey Peter,

So are these "borkers" some sort of new super duper brokers you have on the your side of the pond? (Just having fun with you)

On a more serious note: Yeah we seem to be sooooo regulated here in the US. After all it's for our own good. It may be possible for us to get a broker overseas but I think it is a big hassle. If you can get some nice tax advantages in the UK that sounds great. I too would wonder how long that may last for you.

I'm 90% sure I will open a live account with IG Markets this week, probably for around 1k so that I can trade a $10 contract if I want to. I do like the 6 week period to trade very small while a trader gets comfortable with the live binary environment.

Coach
  • #427
  • Jul 25, 2009 6:41pm Jul 25, 2009 6:41pm
Quoting cmoon10
I can not agree more! I think by putting the odds in our favor we are more like the casino instead of the person playing against the casino. Then just multiply your profits and all the way to the bank. I will look into trading in the 1-2 hours before expiration, I think it is a good way to trade.
Just some food for thought: Start with a $1k account. Each day, the last two hours before expiration, look for that one really good binary for let's say 90 points. You decide to trade it with one full contract. The option then closes at 100. You made $100, one day, one trade. Repeat each day for one month. You have profited $2k. Take out $1k, so now you start the second month with with an account balance of $2K. Follow the same strategy, only trade two full contracts. You would profit $200 per day or 4K for the month. I know someone out there will be thinking this is nothing but a pipe dream. Reality will hit someday. Sure, that could happen. But on each option I trade, I have an 90% chance to profit. 90%!!!!!!!!!

This is what I am working toward for the month of August. This week I will test this strategy some more.

Coach
  • #428
  • Jul 25, 2009 7:14pm Jul 25, 2009 7:14pm
Quoting Coach1959
Just some food for thought:...
I think that is a great idea! I have been trading on Nadex and if I pick a contract for 90 I make 10 for risking 100 so if if I had $1k I could risk 900 and make $100 - the fees. Seems like IG works similar except you can control the value of each point for the contract. Hope I am making sense because I am not familiar with the way contracts work on IG. But anyhow whichever index I still think your idea is a good one. I think it is great MM by lowering your risk month over month. Thank you for the idea!
  • #429
  • Jul 25, 2009 7:44pm Jul 25, 2009 7:44pm
Quoting cmoon10
I think that is a great idea! I have been trading on Nadex and if I pick a contract for 90 I make 10 for risking 100 so if if I had $1k I could risk 900 and make $100 - the fees. Seems like IG works similar except you can control the value of each point for the contract. Hope I am making sense because I am not familiar with the way contracts work on IG. But anyhow whichever index I still think your idea is a good one. I think it is great MM by lowering your risk month over month. Thank you for the idea!
I like the fact that IG does not charge commissions. However with IG every binary option order is a market order. With Nadex you set the price you want to pay, at least that is what I remember from my limited experience with Nadex. Oh...the other thing I like is IG keeps their market for binary options open for 22 hours.

Glad you like my idea. Now let's make some money this week!!!

Coach
  • #430
  • Jul 25, 2009 7:52pm Jul 25, 2009 7:52pm
Quoting Coach1959
I like the fact that IG does not charge commissions. However with IG every binary option order is a market order. With Nadex you set the price you want to pay, at least that is what I remember from my limited experience with Nadex. Oh...the other thing I like is IG keeps their market for binary options open for 22 hours.

Glad you like my idea. Now let's make some money this week!!!

Coach
I'm just waiting for LLc paperwork to signup with Nadex. From what I read Nadex charges a commission but they are not the market maker for the index, is this the same for IG? If it is maybe Ig is the better of the two. I say as I am staring at their ad's. I will give them another look.
  • #431
  • Jul 25, 2009 9:52pm Jul 25, 2009 9:52pm
There is one other thing I want to consider before making my final decision between Nadex and IG Markets as a broker. Nadex offers two binary options that I want to take a look at. One is the weekly binary option. I have a mild interest in that one. The other is the intraday binary options, which is very interesting to me. As I recollect, Nadex offers several option times with expirations during each New York session. I have been thinking that if I employ the strategy I talked about earlier of buying a 90 point option within an hour or so of close, I could make several trades a day . The main downside with this concept is the volatility that sometimes hits the New York session, especially earlier in the day. I could see some nice dollar potential if I could add a couple more trades per day, hehehe! I have a demo with Nadex, so I will try this out on Monday.

Coach
  • #432
  • Jul 25, 2009 10:44pm Jul 25, 2009 10:44pm
Quoting Coach1959
Just some food for thought:...
This is more than a pipe dream. I am doing something similar and I have tripled my money in a month. I started with $50 and deposited another $20 after the first trwo weeks. Trading binaries is very easy. Just keep it simple and don't be greedy. My plan is to withdraw half of my money every time my account shows another zero. Here are the results so far. Do you know what the minimum lot size is the 5th week?

http://img169.imageshack.us/img169/4426/unavngivetb.jpg
If slaughterhouses had glass walls, everyone would be a vegetarian!
  • #433
  • Jul 25, 2009 11:44pm Jul 25, 2009 11:44pm
Quoting Coach1959
There is one other thing I want to consider before making my final decision between Nadex and IG Markets as a broker....

Let me know how it goes. I have looked at those but they just dont suit my trading style but they do sound interesting. I am also interested in the weekly binaries and I may demo those some.
  • #434
  • Jul 25, 2009 11:46pm Jul 25, 2009 11:46pm
Quoting Gambler180
This is more than a pipe dream. I am doing something similar and I have tripled my money in a month. I started with $50 and deposited another $20 after the first trwo weeks. Trading binaries is very easy. Just keep it simple and don't be greedy. My plan is to withdraw half of my money every time my account shows another zero. Here are the results so far. Do you know what the minimum lot size is the 5th week?
Congrats on a job well done! I agree trading in general is easy. You just have to find an style that suits you and most of not get greedy (will get you everytime)
  • #435
  • Jul 26, 2009 12:08am Jul 26, 2009 12:08am
Quoting Gambler180
This is more than a pipe dream. I am doing something similar and I have tripled my money in a month.
See...I KNOW this will work and it doesn't have to be that complicated. Thanks for posting your results. Congrats! I look forward to hearing more in the future.

Coach
  • #436
  • Jul 26, 2009 12:17am Jul 26, 2009 12:17am
Quoting cmoon10
Let me know how it goes. I have looked at those but they just dont suit my trading style but they do sound interesting. I am also interested in the weekly binaries and I may demo those some.
I will post my results, good or bad. Yes, it's important to trade the style you are most comfortable with.

Coach
  • #437
  • Jul 27, 2009 1:13am Jul 27, 2009 1:13am
When will the fx binary markets open? I can't trade anything right now. not even the monthly one touch. I use igmarkets.

Edit: The markets has just opened.
If slaughterhouses had glass walls, everyone would be a vegetarian!
  • #438
  • Jul 27, 2009 8:08am Jul 27, 2009 8:08am
Good day everyone,

I just took my first intraday binary trade with Nadex. I treated it much like a scalp. I waited for price to pullback near last Friday's high at 1.4252 thinking we would have a bounce for support.

Contract: Buy EUR/USD > 1.4277 at 10:00 AM
Size: 10 Contracts ($10/Point)
Entry: 31 Points
Target: Limit to sell 10 Contracts @ 41 Points
Result: Profit Target Accomplished

Happy Trading,

Coach
  • #439
  • Jul 27, 2009 8:12am Jul 27, 2009 8:12am
Quoting Coach1959
Good day everyone,

I just took my first intraday binary trade with Nadex. I treated it much like a scalp. I waited for price to pullback near last Friday's high at 1.4252 thinking we would have a bounce for support.

Contract: Buy EUR/USD > 1.4277 at 10:00 AM
Size: 10 Contracts ($10/Point)
Entry: 31 Points
Target: Limit to sell 10 Contracts @ 41 Points
Result: Profit Target Accomplished

Happy Trading,

Coach
  • #440
  • Jul 27, 2009 10:41am Jul 27, 2009 10:41am
Hey Guys,

I decided to wait and see how the news would affect the intraday binaries. As I learned a long time ago with news trading, usually if you trade the opposite of the initial spike after the news is first released you can do okay. The market already had us thinking long, spiked long after the news release, then sold off hard. How typical is this?...to see a very positive economic news release only to see market sell off, lol. Gotta love the market .

So far I would say, if you decide to trade these intraday options, trade them very carefully. The only real option that is tradeable is the middle one closest to the spot price. Time decay has a major effect on the bid/offer price. I think a real good knowledge of price action is a must. Even at that, days like this can kick you hard! As far as times, it might be best to trade the later intraday binary option times. More often than not these times will not have as much volatility and may be easier to trade successfully. Also, if I do decide to trade the intraday options live, I will trade a much smaller size contract than I will on the daily contracts.

Just some early observations.

Coach
0 traders viewing now