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Commodities

Crude oil trading

The assets traded in binary options are of various natures, but when an investor is interested in trading oil, gold, silver or even agricultural products that means he prefers trading with commodities. Although in binary options the trader’s mission is only to speculate the movement of the price, it is not exactly easy as the commodities market is highly volatile.

How to Trade Commodities

The process of trading binary options commodities is no different from that of any other asset, and you are already familiar with it. What there is to add is that you should not disregard any aspect of the underlying asset and focus on each detail that might be able to give you a hint as to what kind of options (Call or Put, usually) you should buy in order to make a profitable trade. As such, the key to success lies in analysis and research.

If you pay attention to the news you will find out that every global action has an impact on the price of the commodities. It is your job to infer how your commodity of interest will be affected and then start trading knowing that the level of risk is at its lowest and the chances for profit are high. However, due to its increased volatility, the commodity market tends to be deceiving therefore, you must always be up to date with the news regarding your asset and the research must be done thoroughly.

Why Trade Commodities

In the binary options market you know from the very beginning of a trade how much profit you will make or how much you will lose if the contract expires “out of the money”. Trading commodities will be just the same plus the excitement of witnessing significant price swings due to commodities’ high volatility.

It is possible that when other markets are falling, an asset such as oil is gaining in value. Furthermore, if you have signals that the price of oil will only increase for days you can open several contracts where you buy “Call” options and make an impressive profit in a relatively short amount of time. The commodities’ market is generous in dramatic fluctuations leaving many doors open for shrewd traders eager to benefit from them.

Trading binary options commodities is not for the faint of heart, though. It requires a good understanding and a well-built strategy. It is, however, very profitable and it can help you become a successful binary options trader.

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