Trading in binary options involves trading a range of assets and making profits on the prediction of the direction of the price. The assets that you will be working with in this market operate under different trading times. It is important for you to be aware of the trading times for these markets because it will affect your binary options trades as the volatility of the markets will affect the price direction.
Trading is best done when there are large bouts of activity from different traders across the globe. When there is high activity in the markets, the volatility and liquidity that is generated will push an asset to its target price before the expiry date.
Assets such as currencies are meant to have 24 hour trading times, but there are specific times of day when the activity is increased. This is normally during the overlap sessions in the different global trading zones.
Not all the assets operate during the same hours, hence it is important for you to be aware of the different trading hours of the different assets.
Foreign Exchange Trading Hours
The foreign exchange market trades 24 hours per day, for five days every week. However, the market is not very active throughout this period. The overlap session of the Asian and London, and the London and New York trading times are the most active periods. The domestic currencies related to the trading zones active during these overlap times will be the most active during those periods.
For example, the Australian dollar is extremely active during the overlap time between Asia and London. By the same token, the US dollar, the Euro and the British Pound are normally more active during the London and New York overlap session.
Stocks are normally traded for a period of between six to eight hours on a daily basis. The stocks of the major companies based outside the US are normally traded as American Depository Receipts on the US stock trading markets. This means that you should make use of the US markets when checking the best trading times for stocks. The hours for the US markets are between 9h30 and 16h30 EST.
You should be aware of the European markets such as the FTSE and the DAX that have trading hours of 07h00 to 15h30 GMT and 08h00 to 16h30 GMT respectively. If your intention is to trade stocks, you should keep a note of the relevant stock trading hours.
Stock indices are classified as CFD instruments and measure the exchange movements. This means that the S&P and NASDAQ will be operative during the US trading times and the DAX30 during the hours as set by the DAX.
The most active times for the different commodities are as follows:
- Gold: 08h20 to 17h15 EST
- Silver: 08h25 to 17h15 EST
- Crude Oil: 09h00 to 14h30 EST
- Natural Gas: 09h30 to 17h15 EST
- Corn: 09h30 to 13h15 EST
A simpler method of keeping tabs on the trading times is to place the commodities under its trading exchange.
You should determine the most suitable binary options trading time by linking it to the times you spend online. This will give you more profitable opportunities during the times when the market is most active.