Emerging Theories on Binary Options Trading and Market Bubble RiskBy Lex Yaranu | Thursday, July 30th, 2015
Some market watchers are debating whether warnings of bubbles looming on the market will affect binary trading. When bubbles such as the one seen in the United States real estate market burst in 2008 the sudden drop affected not only real estate investments, but also a host of related and seemingly unrelated markets as well. Because binary options trading is less about “hedging” than other markets some theorist speculate it could be hit the hardest, while others theorize the opposite.
The debate centers on the ability of binary options traders to move faster, and staying ahead of bubble collapses.
The concerns of market collapse have increased due to the length of the bull market. As markets tend to move in waves the six year bull market run has some theorists speculating that when restrictions on interest rates are relaxed a correction will ensure driving stocks down to more realistic values. Due to the amount of time the bull market has been maintained this could be a huge risk for those not expect lows and highs to make sudden changes.
The other uncertainty that has some theorists struggling for answers is the possible changes with the oil market. More than other markets the oil market can affect many other markets when it reaches extreme highs and lows. With the Iran deal in place and possible billions of gallons of oil set to come on the oil market from this country many who have seen gains on this market are concerned about a series of sudden fluctuations. American and European interests could be especially affected. In the U.S. oil dropped stinging those with long term investments in American companies on July 17th while today BP shares went up even as QP profits slumped. The British oil and gas giant reported a sharp drop in second-quarter profits due to lower oil prices around the globe.
Bubbles in the market could start appearing as those industries dependent on lower oil prices see gains, while those depending on higher oil prices see a corresponding drop. Watching these markets closely for high and lows is seen by some as a risk, while for others it appears as an opportunity.Published in News