Trading Binary Options (eBook)

Strategies and Tactics

Abe Cofnas (Autor)

eBook Download: PDF

2016 | 2. Auflage
John Wiley & Sons (Verlag)
978-1-119-19418-7 (ISBN)

Infos

A clear and practical guide to using binary options to speculate, hedge, and trade

Trading Binary Options is a strategic primer on effectively navigating this fast-growing segment, With clear explanations and a practical perspective, this authoritative guide shows you how binaries work, the strategies that bring out their strengths, how to integrate them into your current strategies, and much more, This updated second edition includes new coverage of Cantor-Fitzgerald binaries, New York Stock Exchange binaries, and how to use binaries to hedge trading, along with expert insight on the markets in which binaries are available, Independent traders and investors will find useful guidance on speculating on price movements or hedging their stock portfolios using these simple, less complex options with potentially substantial impact,

Binary options provide either a fixed payout or nothing at all, While it sounds simple enough, using them effectively requires a more nuanced understanding of how, where, and why they work, This book provides the critical knowledge you need to utilize binary options to optimal effect,

• Learn hedging and trading strategies specific to binaries
• Choose the markets with best liquidity and lowest expenses
• Find the right broker for your particular binary options strategy
• Utilize binaries in conjunction with other strategies

Popular in the over-the-counter market, binary options are frequently used to hedge or speculate on commodities, currencies, interest rates, and stock indices, They have become available to retail traders through the Chicago Board Options Exchange and the American Stock Exchange, as well as various online platforms, allowing you the opportunity to add yet another tool to your investing arsenal, Trading Binary Options is the essential resource for traders seeking clear guidance on these appealing options,

ABE COFNAS is a leading-edge trainer and analyst in currency and binary option markets, He is a columnist for Futures magazine and the publisher of the Binary Dimensions newsletter, as well as the author of four books, including The Forex Trading Course, He is developing financial gamification platforms that enable users to learn, play, and win at trading financial markets without risk, He is also the Senior Fundamental Strategist for Market Traders Institute,

Inhalt

TRADING BINARY OPTIONS 3
Contents 7
Preface 9
Acknowledgments 11
About the Author 13
INTRODUCTION What Are Binary Options and Why Are They Important? 15
Nadex versus CBOT Binaries 18
Reference 19
CHAPTER 1 Key Features of Binary Option Types 21
Defining the Key Features 22
Strike Price versus Underlying Market Price 23
Currency Pairs as an Underlying Market 25
Moneyness 25
Moneyness and Trader Direction 26
The Role of a Market Maker 28
Are Premiums Fairly Priced? 31
Binary Option Non-Laddered Trading 32
CHAPTER 2 Identifying Profit Return Potential in Binary Option Trading 33
Expected Probabilities 33
Winning Occurrence Analysis 35
Identifying Potential Profits in High-Low Binaries 38
CHAPTER 3 Sentiment Analysis: New Predictive Tools 41
Defining Sentiment 41
Text Mining Mood on the U.S. Dollar 44
Applying Your Own Sentiment Detection When Trading Binaries 47
Step 1: Use Key Terms—Risk Appetite and Risk Aversion 48
Step 2: Scan for Specific Fears 50
Step 3: Scan Headlines 50
Step 4: Form Your Own Keywords for Search Retrieval 52
Step 5: Create Your Own Risk Appetite/Risk Aversion Ranking 54
References 56
CHAPTER 4 Tracking Fundamental Forces That Impact Markets: A Primer for Binary Traders 57
The Fundamental Forces 58
China and the Global Markets 58
Global Growth and Commodity Markets 60
Commodity Markets as a Global Fundamental Force 61
Correlations and Co-Movement Useful for Trading Binary Markets 62
China, the Shanghai Index, AUD/USD, and Copper 62
Gold 64
U.S. Dollar 68
Fear of Deflation/Inflation 70
Foreign Ownership of U.S. Treasuries 73
Crude Oil and the Historic Oil Price Plunge 74
The EUR/USD for Binary Trading 77
Carry Trade and Interest Rate Differentials 77
Central Bankers Move the Markets 79
Checklist for Currency Pairs 79
Bitcoin as a Binary 80
Using an Economic Calendar as Trading Tool 80
CHAPTER 5 Basic Technical Analysis 83
Key Candlestick Patterns 83
Trend Lines 87
Support and Resistance 90
Confirming Strength with Price Break Charts 95
Pattern of Block Sequences 98
Is a Reversal Serious? 99
Examples of Three-Line Break Charts for Underlying Markets 100
Key Patterns for Trading Analysis 102
Triangles 103
Hesitation or Consolidation Patterns: The Triangle and the Doji 104
Fibonacci Resistance Lines 108
References 110
CHAPTER 6 Advanced Technical Analysis: Volatility Tools 111
Defining Volatility 111
Bollinger Bands 112
Interpreting Bollinger Bands 113
Do’s and Don’ts 113
Using Bands with Support and Resistance Lines 115
Using Bands with Trend Lines 115
Adding Another Band with a Different Setting 118
Example of Step-by-Step Analysis 119
VIX: The Fear Index 123
Option Volatility and Sentiment: Put/Call Ratios 129
Sector Put/Call Ratios 129
Volatility Smiles 131
Fear of Recession 137
Tracking Money Supply as an Indicator of Growth 139
Reviewing the Tools 140
Reference 140
CHAPTER 7 Binary Option Trading Strategies 141
The Core Strategies 141
In-the-Money or Deep-in-the-Money 142
At-the-Money or Near-the-Money 143
Out-of-the-Money and Deep-Out-of-the Money 143
Range Traders 144
Breakout Trades 145
World Events and Binary Trades 145
Gold as a Fundamental and Fear Play 146
The Greek Crisis 151
Crude Oil and Near-the-Money Strategy 154
ATM Bounce Strategy 154
Breakout Plays 156
In It to Win It: The DOOM Strategy 159
When Markets Are Overextended: Selling the Ladders 162
Surprise Event Risks: The Great 2011 Japanese Earthquake 162
Chinese Yuan Devaluation, Shanghai Selloff and Binaries 165
Russia Invades Ukraine 166
Perfect Storm Conditions: U.S. Election Week 167
Correlation Trades: Running the Board 170
Noncorrelated Trades 172
Combination Strategies 173
Selecting the Right Underlying Market: Leaderboard Selection Strategies 173
References 176
CHAPTER 8 Analyzing NFP Data for Binary Trading 177
Key Steps Before Trading Nonfarm Payroll and Job Claims Binaries 182
What Is the Consensus on the Coming Data Release? 182
Is There a Trending Pattern in the Data? 182
Is There Consensus Error Bias? 183
Tactics for Trading NFP Report in Binaries 184
Strategy 1: Anticipate Data Release Results 184
Strategy 2A: Trade at Data Release in a Bullish Direction 185
Strategy 2B: Sell Trade at Data Release 186
Strategy 3A: (Buy) Trade at Fibonacci Points 186
Strategy 3B: (Sell) Trade at Fibonacci Points 187
Timing and Managing Trades During the Week 188
Contrarian Mondays 189
Missing Monday: Initiating Trades on Tuesday 189
Surfing the Volatility Wave: At-the-Money Wednesdays 189
Going with the Crowd: Deep-in-the-Money Thursdays 190
Last Chance: Very-Deep-in-the-Money Fridays 190
Using Binaries with Forex Trading 190
A Word on Intraday and Intra-Hour Strategies 191
References 191
CHAPTER 9 Risk Management in Theory and Practice 193
Deal or No Deal? 194
The Confidence Index 194
Lot Size Management 195
Offsetting Trades: Failing Forward 196
Leverage and Margin 197
References 197
CHAPTER 10 Metrics for Improving Binary Trading Performance 199
Key Performance Metrics 199
Win/Loss Ratio 199
Adjusted Win/Loss Ratio 200
Near-Miss Ratio 200
Distance from Breakeven 200
Win/Loss Duration 202
Trading Sequence Patterns 202
Strategy Scorecard 202
Performance Challenges 203
Performance Challenges for Trading High-Low Binaries 205
Analytical Challenges 205
Know Your Trading Personality 207
Targeting Total Returns 208
CHAPTER 11 Performance Tools and Training for Improving Binary Option Trading 213
Algorithmic Trading: Is It for You? 213
Advantages and Disadvantages of Automated Trading 213
Developing a Trading System 214
Get the Data 214
Develop the Rules 215
Test the Rules 215
Test in Real Time 216
Moving to a Live Account 216
Evolving Your Approach 216
Using Alerts 217
Algo Alerts Trading Competitions 218
Afterword 219
Appendix A: Test Your Knowledge 221
Appendix B: More Training Tools and Tests 231
Index 233
EULA 243

Produkt-Details

• Erscheint lt. Verlag: 22.6.2016
• Reihe/Serie: Bloomberg Financial
• Reihe/Serie: Bloomberg Professional
• Reihe/Serie: Bloomberg Professional
• Sprache: englisch
• Themenwelt: Recht / Steuern ► Wirtschaftsrecht
• Themenwelt: Wirtschaft ► Betriebswirtschaft / Management ► Finanzierung
• Schlagworte: Abe Cofnas • Börsenhandel • best binaries liquidity • binaries guide • binaries markets • Binary Dimensions • Binary options • binary options explained • binary options trading • binary portfolio hedging • binary strategies • Börsenhandel • Cantor Fitzgerald binaries • Finance & Investments • Finanz- u. Anlagewesen • finding a binaries broker • hedging with binaries • how binaries work • integrating binary options • investing options • lowest binaries trade fees • New York Stock Exchange binaries • profitable binary options • simple options • speculating with binary options • Trading • trading binaries • Trading Binary Options: Strategies and Tactics, Second Edition
• ISBN-10: 1-119-19418-0 / 1119194180
• ISBN-13: 978-1-119-19418-7 / 9781119194187