Asian session and binary options
- VFX Blog
- For beginners
As you know, «money never sleeps» even when the weekend or holidays of transactions with currencies and exchange-traded assets continue, on the chart it looks like an empty space between the open/close price and «gap». Forex is most active during trading sessions in Europe/America, but night strategies how to make money on binary options can also give good profits.
First, you need to decide what is meant by «Day» and «Night» in relation to binary options. For example, for traders on the European side at night, it will be Asia and the overlap of trading binary signals for Asia/Europe. They are considered «overnight» in most strategies and publications in the foreign exchange market. We will not change the established opinion, especially since these periods have pronounced individual properties.
More about the trading session (00-09:00UTC)
The day starts and notice that trends are often formed throughout the forex market during this period. It accounts for up to a quarter of the total volume of open positions in Asian pairs, including the yuan. Key Features:
- Liquidity is still low and any forecasts may turn out to be wrong, despite the data of the indicators. Major players primarily seek to move the market in the right direction and new price highs / lows. The issue of current profit becomes a secondary factor. But of course there is general control!
- Fundamental statistics, news from Japan and Australia set intraday ranges for all pairs where the JPY and AUD are present. As a rule, the statements of officials occur at the end of the session - the reaction of free binary options signals is weak, if it is not currency injections, earthquakes and other force majored;
- The largest positions on the yen are opened by the Bank of Japan and its associated major shareholders with a large share of export/import operations involving the US dollar;
- Although the Yuan is not a fully convertible currency, the news from China has a strong impact on the entire region. For example, the morning commodity quotes (precious metals, iron ore and mineral fertilizers) of the Shanghai Stock Exchange often cause speculation on AUD (NZD)/USD, USD/JPY, cross-rates.
From 01: 00 UTC, when the Shanghai and Hong Kong stock exchanges start trading, we look for Chinese participants and funds: if there is an active buying of dollars, we expect speculative actions throughout the day, buying euros-technical analysis works without sharp movements.
- Look at the volatility of the previous day. If it is high the current session on the main pairs may give a narrow sideways movement in the night channel;
About 85% of foreign exchange and exchange assets go through Tokyo as the largest financial center in Asia, although the share of the Singapore, Shanghai and Hong Kong exchanges has grown significantly over the past few years. The start of the Tokyo Stock Exchange will be the calculated intraday price swings (momentum) level.
If you are a short-term binary option trader and take a moderate risk, the best results will be on USD (GBP)/JPY and GBP/CHF options. They move in a fairly wide corridor of 75-95 points, which allows you to open a deal with a fairly long expiration within the current trend.
For medium-term (with a duration of 2-3 hours) moderate binary option strategy, choose AUD (NZD)/JPY crosses and their dollar equivalents. Volatility is low and, importantly for options, there are regular and long-term trends. For the economies of New Zealand and Australia, mineral exports provide a significant share of GDP, and any movements in commodity futures cause a quick response from national currencies.
Opening at 00: 00 (24: 00) The UMT of the Tokyo Stock Exchange can already be used for the first transaction. Japanese investors have a corporate discipline; most of them immediately turn towards the «leaders». In the Forex market, you can open two pending locked (multidirectional) positions at a distance of 10-15 points and monitor the development of the situation. Options, unfortunately, do not allow you to do this, you will have to monitor the market personally and have a good reaction.
Asia/Europe (07–09:00UTC)
The European session begins not with London, as many think, but with Moscow, Frankfurt and Johannesburg, which move synchronously with Asia for two hours. Activity falls to a minimum, most of the participants only close the current profit/loss without opening new deals.
In Europe as a whole, the most frequently asked question concerns London's role as an exchange center in light of the final Brexit decision. "Whether this will affect the overlap period with Asia or not. How to trade in such a market? ». At the moment, there is no clear answer to this question, although a significant part of London's intraday turnover, both in currencies and in stocks has already moved to Frankfurt. Most likely, the situation on top binary options forex signals will not change dramatically, because basically the overlap performs a fixing function, and does not earn.
Currencies, strategies, recommendations
We start with a recommendation for the yen (JPY), which accounts for an average of 18-20% of the daily Forex volume. The Bank of Japan is 55% state-owned, the rest of the shares are owned by large corporations and are traded as a standard exchange asset. It is quite logical in this state of affairs to regularly intervene by the state, although there have been no major foreign exchange interventions since the earthquake 2011:
- USD/JPY is influenced not only by local statistics but also by fundamental developments in the United States, especially China as the region's main raw material supplier. It is considered one of the best pairs for working out Non-Farm Payroll since there are practically no speculative pullbacks and corrections;
- Technical analysis works better on the trend, during the Asian session; the Yen can be used as a leading indicator for AUD and NZD. For the cross market, such as AUD (NZD)/JPY, you need experience in news trading, so beginners, at first, it is better to choose other options.
Next in volume is the Australian dollar (AUD, 11% of the Asian session), which requires an analysis of the stock and commodity markets in China to forecast. Gold exports are one of the main budget items, so there is a high correlation between exact binary options strategy and the corresponding futures:
- Strong influence of fundamental data on Japan, China and the USA. Any speculative action by the Bank of China causes a quick reaction on the chart, which is why the pair is often used for hedging trades, including options.
- The asset, due to the prevalence of the raw material component, has high liquidity and is confirmed by real volumes throughout the trading day.
All trending or multicurrency with gold, New Zealand and Canadian dollars are recommended from strategy for binary options.
The New Zealand dollar (NZD) completes the brief overview. It is one of the TOP 10 global exchange-traded assets and accounts for 10% of Asia's turnover. The economy is dominated by agricultural products (followed by iron ore and non-ferrous metals), so the weather factor directly affects the exchange rate.
Easily amenable to technical analysis, possible speculations only of the USA's own fundamental data and statistics. We use medium-term night strategies!
We turn to the examples of exact binary option strategy, which can be devoted to a separate series of articles. The basic principle is to always remember that these assets are very "technical", no "super-methods and proprietary indicators" are required. To confirm this, here are two examples.
- Bollinger is used as a channel indicator with trades from its borders, and the CCI commodity channel index confirms the slowdown / acceleration of the market pace, which is always present before a reversal;
- Two Bill William’s indicators on the right. The breakouts of the Alligator moving averages and the zero level of the Awesome Oscillator are working well again. The main thing is not to go below the M15-M30 timeframe and 2-3 bar expiration.