Binary Options: A better way to trade Commodities?

Ok, we all know what Commodities are and how to trade them but maybe there really is more than one way to skin a cat. Since literally skinning a cat won’t bring us any money (or at least I don’t think so), let’s focus more towards other ways of profiting from Commodity trading: what I am proposing is Binary Options trading. Yea, I know, everybody is raving about them and everybody wants to jump right into trading them…especially gamblers and novice traders because Binaries seem so easy and profitable. Well, they are…if you know how to trade them and don’t just use them like a slot machine.
Now, I’m not gonna bore you with the history of Binary Options or other stuff like that because it’s really not important. What is important instead is that Binaries are derivatives and their value is calculated using an underlying asset (like commodities). The formula or method used to derive their value was never of interest to me and I think it will never be. Technical and Fundamental analysis needs to be conducted the same way as if you were trading any other type of instrument, but you don’t care about the distance traveled by price in your direction because you only need price to be one pip above or below (depending on your chosen direction) the price at which you purchased it. Yes, one pip is all you need and you win the entire payout. And the only difference is that instead of Buying or Selling, you use a Call (Buy) or a Put (Sell). Well, if that sounds interesting, keep reading.
A little about binary trade mechanics
Usually the payout for a Binary Option trade ranges between 65% and 95% (depending on the broker). In other words, if you open a $10 Call trade (you expect the Commodity will increase in value) and price at expiry time is one pip above the opening price, you will receive your 10 bucks investment back, of course and on top of that, a profit of $6.5 to $9.5 (top brokers have payouts closer to 95%). I guess that’s why all new traders jump right into Binary trading, because it’s easier to understand: if I believe the price of the commodity I am trading will go up, I’ll buy a Call and vice versa for a Put and all I have to do is wait for the option to expire (there is a wide choice of expiry times, ranging from 1 minute to a day or even more in some cases).
Some final thoughts
Ok, I’m gonna stop yapping about trading Commodities using Binaries, but I want you to get the main idea: all aspects of Commodity trading remain the same; news affect a binary trade on Coffee the same way it affects a normal trade on Coffee, technical analysis will be conducted the same way, but instead of taking into account all the Stop Loss and Take Profit levels, you just buy a Call or a Put. I don’t know about you, but I’ve had a bunch of trades that barely touched my Stop Loss and then reversed, going straight to where my Take Profit would have been. My other face-palm moment is when price comes close to my Take Profit level, teasing me and then just plunges towards my Stop Loss, taking it out just like Buffy slays vampires…yea, no more of that if you are using binaries because price can do whatever it wants as long as at expiry time it is above (if I selected Call) or below (if I selected Put) the purchasing price. Ok, wrapping things up, it’s nice to have more options when trading commodities and binaries do just that, by offering us a more flexible way of trading.

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