Going offshore to escape the CFTC

Broker Discussion Forex Brokers
8083

MORE ON BINARY OPTIONS TRADING

Let’s consider “the Spread” and the concept of “zero Spread”.
The Binary Option market, in most cases, has zero spread.

And let’s couple that idea with the concept of a fully “binary"
outcome. A very small favorable outcome yields a fixed
"non analog” profit value.

As you’ve observed, when you Lose, you leave your wager
on the table for the House to collect. And when you Win,
you a) keep your wager, and b) profit by Payout% of your
wager amount. No other fees are involved, and there’s
also no “spread” (in many implementations).

So, for a 50% payout, one Loss needs 2 Wins to bring us
back to parity. This is with a fixed wager amount. However,
we are also free to vary the wagered amount in any way we
wish. As in a Casino, we “bet big” when we have a strong
"edge" and “bet smaller” when that is not the case.

NOW TO MY MAIN POINT, and why Binary Options are so
attractive to me. Apart from the Risk Management aspect, I am
considering it from a micro scalping or “day- or minutes- trading
or scalping” perspective.

With a “micro scalping” scenario, where the "binary outcome"
can occur in as little as 30 seconds latency, or as long as 1 month.
In 30 seconds I could make X% of my wager. DONE DEAL.
That is “in the noise level” of markets perhaps, with a very low
signal to noise ratio. But perhaps with 2 minutes, 3 or 5 minutes
durations, there is a more favorable S/N ratio, or probability
that a Signal predicts the outcome. Or 30 minutes, etc…

Just how “deep” or “accurate” is your technical ability to predict Price ?
Do you have predictive measurements on the timescales or
latencies which you propose to trade ??

So, let’s be reasonable. But with a 70% payout, I can wager $100
( which I am not worried about, since I “know” the outcome will
be in my favor, hypothetically Ha-Ha! ) and make $70 if the Price is
at least *1/10 PIP" in my favor on expiration. In this "digital or binary"
world, 1/10 PIP can be worth a huge amount. But in the "analog"
world of Forex, in order for me to make $70 on 1/10th PIP, I would
have to expose myself to a very large downside Risk, in order
to have the upside gain potential. That is another way of stating
the value of an Option and showing its Risk Management properties.

So, micro-scalping can be “very profitable” BUT only assuming that
you have high WIN rates, even in markets which “are not moving
or are only ‘in chop’ as we say”… And that may require some
"automated assistance" in execution…

So one key factor I haven’t discussed is “how fast” the decision can
be made at just the right moment, so some automation is required, not
just for indicators, but for responding to indicators at just
the right instant… :slight_smile:

Everyone knows that Traders must “time the market” and choose the
right moments to enter. But the casual non-technical investor is advised
never to try to time the market, since she lacks the ability to do so.

hyperscalper

1 Like
8084

I’d say that the biggest upside to binaries is that you can win a lot, very quickly, regardless of price movement, without having to worry about spreads and other nonsense. The biggest downside is that you cannot choose when to close out your trade and you’re stuck with a lousy R:R.

I did notice that you can trade on different timeframes, using different trading parameters. For example, if trading on the 1-minute chart, you can set your trade up so that your close doesn’t happen until 2 or 3 candles away. I think that this is an important consideration because even though you know where the price action will go, you never know if that very next candle will move in your favor.

Looking at PocketOption, though, the price action looks suspect, such that it is moving in such a way that will cause a lot of traders to lose. Maybe I am being paranoid, but just looking at the daily charts has me scratching my head. Maybe this is why the pairs are noted as OTC, such that the valuation is all internal and not representative of real price action? If that is the case, I would strongly avoid.

1 Like
8085

There are various binary games. If you are a U.S. person you can play the
NADEX game, or perhaps use traditional Options. In every case, unless you can
PREDICT the price of the underlying (these are all “derivatives” of something)
then you can’t win any of these games.

Some “binaries” do provide for early discretionary expiration of the contract
with a lesser payout, but let’s just concentrate on the fixed term Up/Down
Binaries as with CloseOption dot com.

Personally, the idea of trading using only “candles” lacks the precision
and ability to predict future price. Yes, I know that "price action trading"
sound good, but for my money it isn’t predictive enough. My own work
in Forex uses advanced Currency Analytics, involving prediction of an
individual pair’s trending, from the interacting trending
of the 2 Underlying Currencies X and Y trends in real time

After all, any given Currrency Pair is fundamentally constrained by the
relationship between 2 Currencies’ behaviors, which goes a bit deeper
than Currency Pair price action.

But this isn’t a class on Technical Analysis ! :slight_smile:

To convince yourself, get a CloseOption Demo account and just try
to Win on a relevant predictive timeframe, using only Price Action.
If you have a way of reacting to a “spike” in sub-second latencies, then
sometimes you can use the “noise level” of pricing retracement to
Win, say, a 1 or 2 minute fixed timeframe.

But that isn’t enough to Win enough, and very much encourages the
worst habit in trading, which is “over trading”.

Binary Options expose the “wiggles” of price action which most traders
disregard. A Binary Option trade can operate on the volatility inside

a single PIP of Price Action, which requires non-traditional Analytics
methods. Just sayin’… this is a warning that Binary Options may give
you the impression (especially if it’s dressed up as a “game”) that
Winning is easy. Indeed that is how many traders are sucked in, to
directly provide (through their Losses) the revenue to fund the Winners !! :frowning:

This is indeed the main reason Binary “games” lilke this are BANNED,
since they make it simply too easy for the Novice to participate and lose.
In that respect, they are just like widely available Lottery games, and we
all know what that leads to for the average working Joe or Jane !!

For the professional trader, they are good Risk Management tools.

hyperscalper

1 Like
8086

Wow, you put everything into way too nice looking.

I can write the opposite of your post:

  1. You say binaries can limit your losses and are great for risk management. I never heard this, risking 100$ to win 50$ is a good risk management. Oh dear…

  2. You wrote somewhere: even if you are 0.1 pip in the winning you get the full payout. Well, if you are 250 pips in winning you also only get the payout and not the money what you would have done without binaries.

  3. Have you asked the question why your broker gives you continuously cashbacks??? Do you really think they just don’t have any better thing to do then give you their money especially when you are winning and they are losing with you? Yes, I tell you why: because they go with the strategy that always work: keep you as long you trading with them as long you lose all your money. Not because they want to give you present.

Besides that, you whole post critisizes price action and focuses how amazing trader you are. AND NO, only because you believe in your analyses, many others can make money in different ways, not only to your “advanced way”.

All in all, you started something new and we like it to read but you should stop pushing this thread to trade binaries like in your last post.

If you want do it then do it, but the very clear fact is that it is a very very very bad, or even I would say the worst deal out there and people have to know this and rather go for ways where they have a better chance than this.

Still, I will be interested to see and know when you make withdrawals, especially large ones how they will pay you out one month after the next.

All the best of LUCK.

1 Like
8087

Thanks! I try to make a contribution.

My point has been not that I am such a great trader; but that any trader needs
to have Analytics which are “up to the task” of predicting the future, in whatever
“niche area” they are operating.

If you are NOT a U.S. person, then you have access to lots of legitimate
Binary Options dealers, not the least of which would be the highly reputable
Dukascopy. Their payouts are up to 90% or so and they are very transparent.

Price Action trading is a “strategy” like any other technical strategy. I would just
point out the obvious that it needs to be appropriate to the timeframes you
wish to hold. In Forex, price movements are the result of 2 factors, the X currency
and the Y currency, which is why my personal belief is that Currency Trending
contributes a huge amount of clarity in understanding Currency Pair movements.

Yes, indeed, all Options limit both your Upside and Downside. They are a
Risk Control vehicle. *Sometimes straight Forex ‘analog’ or ‘proportional’
returns are desirable; and other times, fixed option type results are wanted"
so, of course you are correct in your math.

I’m just trying to show opportunities available to U.S. persons which can
enhance our “toolkits” for trading… And you’re welcome for that ! LOL
But, seriously, although you are justified in being sceptical on Binary Options
dealers, you are also a bit over-the-top sceptical of regular ( but unregulated )
Forex brokers, I’d also say. :slight_smile:

[EDIT] I should say that you are strongly implying that I am GUESSING, as
you emphasize LUCK in your closing remarks. If you think, based on my postings,
that I am content with guessing; I’d say you have not read my posts that carefully.
Without appropriate analytics, I try not to engage in trades. Trading Binary Options
is NOT a lottery, for those who have the tools to make predictions, in the
environment or ‘niche’ in which they are operating… :slight_smile: <-- smiley face there

[EDIT] Definitely in the category of “don’t try this at home, kidz” LOL
Here you see the span of 1 PIP illustrated, in EUR/USD on CloseOption
binaries. Unless you have something “special” don’t try to “guess” in
such a market. :wink:

CloseOption-micro-scalping
CloseOption-micro-scalping1657×731 39.7 KB

hyperscalper

2 Likes
8088

I’d be interested to know if either Pocket Option or Close Option had crypto such as eaglefx, that said methos warning about pocket option doesnt sound reassuring. I also didn’t see great things online to say the least about DigitalTradeFX, and didn’t see much info on it as a whole.

1 Like
8089

CloseOption has crypto pairs Binary Options.
However, I haven’t watched the range of payout percentages to see whether
they would be worthwhile, and anyway, I don’t have technical analysis for them…
I stay with Forex only.

[edit] I think PocketOption has only like 2 minute options, but CloseOption should
have them for a wide range of expiration durations from 30 secs out to 1 month.

hyperscalper

1 Like
8090

They do. And the price action for crypto doesn’t look suspect like the forex does. Unfortunately, I was unable to find a chart on trading view to determine where they are getting their market data from, to be able to rule out any funny business. Personally, unless I can verify that the data is legitimate, there is no way that I am trading it.

Based on the demo that I tried, there are different timeframes available. If I recall, the cryptocurrency pairs did not offer as many options as the FX pairs, but I don’t remember.

And that is what I get from it, which is appreciated. I think that the cautionary posts outlining some of the associated risks are also important, because, as you say, you really must be on your game to be successful in the long run, and most traders may not be able to do that with BO.

Overall, though, I think that any successful trader would have some ability to predict where the market is going, else they wouldn’t be able to trade for very long. So, FX may be a better fit for most since it allows for more flexibility. I would venture to guess that most full-time trades are not scalping the market, either, and that really is a skill that you must have to engage in binary options, since I think that the biggest benefit with binary options will be seen on the smaller timeframes.

1 Like
8091

He knows the math and it is his money, so if he says it works, then it works.
I know many people use volume analysis and it seems to be the only approach that works intraday.
But the main problem is volatility.
Traders who use volume analysis can win 9 out of 10 days, but once volatility suddenly pick up, he may lose a big day that offset 10 days of winnings. Binary option is a way to avoid this.
The only problem is, binary option brokers are betting against customers. So if you win, brokers lose.
I don’t think brokers will let you keep making money on them. They have too many ways to stop you.

1 Like
8092

Watching Binary Options, like CloseOption dot com, there is the temptation to try your hand at micro-scalping 30 secs or a minute or two. PLEASE RESIST THAT TEMPTATION. Instead, use these Options for News Event volatility and for longer term predictions, leveraging the Risk management aspects of the Options.

When you do this, do so when you have 70% - 80% payouts, as is the case right
now for EUR-USD at CloseOption.
That payout will then be locked into your longer term prediction
contract outcome. That approach is sensible, when you don’t have access to
reliable short term indicators for scalping, as is the case for most traders !!!
BE WARNED ! :slight_smile:

Convince yourself by using a DEMO account, if you still can’t resist trying
your hand at Binary Options 1 minute scalps !!! You’ll quickly see it’s a mistake !

hyperscalper

8093

NEWS EVENT RISK MANAGEMENT

I have said that Binary Options can be an effective means of
managing Risk on Volatility, such as News Events. I started
a new thread to discuss my view of News Event trading here:

Here, one small aspect of the whole strategy can be dealt with
through Binaries, but the huge topic of News Event trading is
something I’ve worked on for several years now, and volatility
is just one aspect of what is a much larger trading opportunity.

hyperscalper

8094

I recently started with LQDFX. For 7 sessions in a row I’ve seen EU and UJ trade with 0 spread during LON/NY. This broker has some downside- 20 stops level (Use an EA), no stablecoin w/d or dep and the swaps are pretty bad compared to the other brokers we see discussed here.

1 Like
8095

Sure but I wouldnt say that the broker is a 0 spread broker with only 2 pairs. Typically UJ and GU and EU have low-no spreads. LQDFX Was one that I was looking at so thanks for that info

8096

After replying about zero spread, I skimmed the rest of the messages below about binaries. I saw some flamage toward @HyperScalper and didn’t read every word, but I’d like to thank him for pointing out any and all trading options available to the unsullied. Our good options seem to be dwindling slowly. I have zero interest in binaries, but that doesn’t mean I won’t take it up someday. I get a lot of solid news from this group. Thanks to everybody.

1 Like
8097

Another LQDFX downside I forgot earlier- They take between 2.25-2.50% of your crypto deposit. I expect the same happens with withdrawals. Can anybody verify this? @smallpaul you trade with them?

1 Like
8098

the withdrawals not bad but when i made a deposit i was surprise at how much they took

8099

SPREAD IN FOREX VERSUS NO-SPREAD BINARY OPTION

A picture can be worth a thousand words.

Binary Option on the left on EUR/JPY; Tick feed from Forex broker
with Bid/Ask spread and virtual T&S volume event annotations
on right. ( Custom software )

CloseOption-versus-Forex-size-and-pricing
CloseOption-versus-Forex-size-and-pricing1687×918 91.3 KB

[EDIT] these are simultaneous; but you’ll note their horizontal
server time axes references may differ by an hour… Peaks
and troughs should be easily matched up visually, I hope.

hyperscalper

1 Like
8100

Hello, I was curious what broker everyone here finds to be the best overall as far as withdraws, spreads, commissions, etc… Also which broker is best for scalping? Thanks in advance guys

8101

Hands down, that is Coinexx; with some similar terms also available through
TurnkeyForex . This is limited to discussing Forex only, from my perspective,
since I don’t trade anything else which is offered.

[EDIT] lest we forget; this applies only to those available to U.S. persons;
because, if you are not in that category, then the choices are vast… :slight_smile:

hyperscalper

8102

Thanks a ton for the fast response! I’ll have to give them a shot. Would you recommend them over FX Choice?