Options Within the Binary Options!
So far we have only really taken a look at the high/low type of binary options and since there are so many different names for it we will just group them as up/down options. There are also touch/no touch binary options and range bound binary options so the choices are there. We only use the up/down binary options here at ElectroFX.com because they allow us scalp in the same way we would trade Forex longer term. This avoids the need to learn anything new and means that the one style of trading taught here can be used to trade the daily chart down to the tick chart. For the sake of being thorough let’s take a look at the different types on binary options so you know what is available.
Up/Down Binary Options
Our favorite are the up/down type of binary options and this type was used in the binary options example lesson that you should have already completed. These binary options are also know as high/low, rise/fall, or call/put. They are very simple and this is probably why they have the lowest payouts which usually range from 65-85% but we have found one binary options broker that offers up to 100% payouts also. You can visit them here.
The idea is as simple as selecting which direction you think price will go for a specified duration of time. This could range from hours to the whole day. or from minutes down to even just seconds. Different brokers offer different choices for time duration. Once you enter you will get your strike price and your chosen asset must close above, or below that depending on if you chose up, or down respectively. If you want to refresh your memory with before-during-after screenshots of a 30 second binary option then jump back to the binary options example lesson here
Touch/No Touch Binary Options
The next type of binary options trade requires you to specify a price that your chosen asset will touch, or will not touch, just like the name suggests. If you were to chose the touch binary option then the price of your chosen asset will need to touch your strike price at least once during the time duration selected. It will not matter if price stays above,or below, your strike price, it just needs to touch it before the contract expires. On the other side of the coin, a no-touch trade requires that the price of your chosen asset does not touch your strike price during the selected duration of time.
The touch/no-touch binary options generally have higher payouts then the up/down binary options and are often only available at certain times of the day. The risk:reward is very appealing with this type of trade but the trading opportunities per day are dramatically less. This type of binary options trade may suit some people but is not something that is pursued here.
Range Bound Binary Options
The last type of binary options trading involves trading ranges. The variations are to predict that the price of your chosen asset will stay within a specified range for the selected time period, or that the price of your chosen asset will end up outside a specified range for the selected time period. Just like all binary options trades this type is very easy to understand and very easy to execute. Just like the touch/no-touch type of binary options trade, this type of binary options trade may suit some people but are not pursued here at ElectroFX.com.