Binary Options In the Context of Global Financial Crisis

By Adam | Friday, January 22nd, 2016

bianry options financial crisisIt seems the news is not giving the facts enough coverage. If you look at the financial system and what’s happening it looks like 2016/2017 are going to be the year of market collapse and a full blown global financial crisis.

In the last week alone over 100 billion has been wiped off from the FTSE100 index. China’s economy is not only slowing down but doing it in a spectacular way. Oil prices have fallen to an unexpected 50-year low, some major banks go as far as to announce hardships ahead for investors and recommend selling all stocks. The fuse of the major financial crisis has been lit in the first days of 2016. So what’s an investor to do?

In time like these, a long term investor should look into buying Gold / Silver / Palladium, as well as, invest in new technologies such as Bitcoin. These assets are very likely to become quite valuable in the near future. Gold is the most obvious safe haven for times of financial turbulence but silver and palladium are also very good investments.Safe and cheapest way to buy gold

Bitcoin and blockchain technology are revolutionizing the world. They may suffer some temporary setbacks due their high volatility but investing in new technologies usually pays off in the long run. The beauty of Bitcoin is that you can use it as a currency so your investment remains fully operational. There are now thousands of places that accept bitcoins. In addition, it’s also relatively easy to sell bitcoins online.

You could also look at Gold mining stocks and Bitcoin related company stocks to supplement your long term portfolio. It’s very likely that they are about to explode once the crisis really sets in. Gold for obvious reasons and Bitcoin, being a decentralized ‘peoples” currency, has a very high chance of survival even in a complete market crash.

No financial recession has ever been able to stop groundbreaking technological progress. There is always going to be money and financial backers for technologies that will change the world. Think of artificial intelligence, DNA and gene manipulation, organ printing, and other areas that will change entire industries. For the long term investor it might also be worth looking at buying stocks of companies that are on the forefront of technological advancements in these areas.

Binary options as a short term solution to a crisis

falling pricesEven long term investors keep about 10-20% of their capital in short term investments. The case for binary options is a very simple, it’s one of the quickest trading solutions for short term investments. Basically anyone can start trading binary options in about 5 minutes, that’s how long it usually takes to open an account with a broker. In addition to a quick online access, binary options are very easy to understand and to trade. That’s what makes them so popular. Anyone can learn to operate and trade on an online binary platform. It’s a lot easier then purchasing and monitoring stocks and buying on margins using more complicated software such as TD Armitage or Plus500, etc.

What really differentiates binary options, however, is that you can earn over 70% of your initial investment within a very short time period. In binary options trade expiration times range from 30 seconds to 6 months and the end price (known as strike price) has to be lower or higher (depending on the direction you choose) than the price on entry. Be advised that if you lose a trade you will most likely lose the entire traded amount. In order to be winning at binary options you need to remain a win ratio of at least 75%.

If you observe what is happening with the recent prices of falling assets it’s quite easy to predict the next movement of the price simply be observing trend lines and basic support and resistance levels.  You could also be looking at the next economic releases and how they play out in the markets. It’s a lot easier to trade binary options when you know the general trend and investor sentiment. Of course in order to utilize this knowledge you can’t be trading off the 1 minute charts. You should trade of 5M, 15M, 30M, 1H or 4H charts.

The best part in binary options is that even if the difference between the price on entry and the strike price (price on trade expiration) is 1 or 2 pips in your favor it would be a winner and your account would be credited with your initial trade amount + 80%. If you were trading Forex 1 or 2 pips in your favor would barely cover your commission costs taken by your broker at the time of opening a trade. Forex has it’s own advantages, but to make 80% on Forex is a huge success and it takes considerably longer to achieve.

In conclusion it will be interesting to see how investors approach binary options in 2016 and whether this year will see binary options use rise or fall. Please share your opinion in the comments below.

Published in News & Analysis

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