Weekend trading with binary options allows traders to trade throughout the week. Forex trading has been around for a while. Even without a central market, exchange rates can be traded wherever the world market is open. This article will explain the specifics of weekend trading and how you can be successful in online trading over the weekend.

 

 

This article answers the following questions

  • Can I trade on the weekend?
  • Why trade on weekends
  • Limits of weekend trading
  • Strategy

With this information, you can be successful using binary options as a weekend option.

Can i trade on the weekend?

Most binary options traders intuitively assume that you cannot trade binary options on the weekend. This is a misunderstanding. The Western world, of course, provides all indications in support of this thesis. Fortunately, there is more than just the Western world.

Different cultures have different days of the week. As a result, their stock exchanges are open on different days of the week. For example, in the Middle East a week runs from Sunday to Thursday, and elsewhere a work week runs from Saturday to Wednesday. Stock exchanges follow this pattern.

You need a public stock market to trade binary options. When the market moves, you can predict where it will go. As long as there is some open market in the world you can trade binary options.

The Middle East alone can guarantee an open market over the weekend. The stock exchange is open on Saturdays and on Sundays, so weekends are full of trading opportunities.

Traders who want to trade binary options on a currency and commodity basis can use weekend trading to follow a trend found on Friday or complete other trading objectives. Currency pairs are not traded on central exchanges, so when at least one major market opens (Hong Kong, Sydney, New York, etc.) you can speculate on the exchange rate. ‘Weekend Effect’ trading strategies also have courses highlighting their particular popularity.

Best Weekend Brokers

Why trade on weekends

There are three main reasons traders choose to trade on weekends. they:

  1. Weekends provide an ideal trading environment for some strategies. When only a handful of Asian markets are available for trading, most European and American markets behave differently than open markets. Different market environments help some traders perform strategies better than others. We will introduce some of these strategies later.
  2. Longer trading hours means more profit. With a profitable strategy, the longer you trade, the more profit you can make. Traders with free weekends can use binary options as a profitable alternative to TV and boredom. Dedicated traders can trade seven days a week.
  3. Some people can only trade on weekends. If you’re busy during the weekdays, the weekends may be your only chance to land a few trades. A broker that allows you to trade in your free time allows you to combine a trading career with a busy schedule.

For this reason, many traders love the trading opportunities on weekends. On the other hand, weekend trading has some limitations. Let’s take a look at the downsides of weekend trading so you can evaluate both aspects.

 

 

Limits on weekend trading

You can trade binary options on weekends, but there are some limitations. they:

Limitation 1: Limited Asset Selection

On weekends, you can only invest in a limited selection of assets. Stocks and indices are traded on their national stock exchanges. For example, Google, Apple and McDonald’s are US companies and trade on the New York Stock Exchange. When the New York Stock Exchange closes, you cannot trade binary options based on these assets.

If only the Middle East market is open for business, you can only invest in stocks and indices. For serious technical analysts, this isn’t a problem. In any case, you only trade price movements and are indifferent to the underlying asset.

However, for traders who trade news or want to know about the assets they are trading, this is a problem. They may face a variety of stocks and indices they have never heard of before. This can be a difficult situation for some traders making weekend trading impossible.

This index is available for weekend trading.

  • DFM Index (Dubai, United Arab Emirates),
  • Tel Aviv 25 Index (Tel Aviv, Israel),
  • Kuwait Stock Exchange (Kuwait),
  • Tadawul Index (Saudi Arabia).

If you can work with this index, go ahead. Brokers also started offering weekend access to some markets that were previously unavailable. For example, IG now offers weekend trading on the FTSE, DAX and US Indices. All ‘weekday’ positions are left alone (thus loss-of-loss and open orders are not processed). The broker offers new deals from 8am on Saturday to 10:40pm on Sunday evening. Other brokers should follow suit.

Forex weekend trading hours are much more extended. Without a central market, currencies are traded worldwide. Even if London stops trading, Hong Kong still does. This means forex trading is available 24 hours a day, almost 6 days a week. Weekend gold and oil trading markets are similar. However, the volume is very low during certain times. This leads to flat markets and charts.

Restriction 2: Different Time Zone

All stock exchanges operate in their own time zone. Stock exchanges in the Middle East are far from the United States and many other places, so there is a significant time lag. These time lags must be taken into account if you want to trade stocks and indices on these stock exchanges.

For binary options traders looking to invest in stocks and indices, it means making significant changes to their trading routines. They may have to wake up in the middle of the night or at least trade at different times than during the week. If this is not possible or worthwhile, you should focus on trading stocks and indices during the week.

Restriction 3: Broker Trading Hours

Some binary options brokers close their trading platforms on weekends. In their opinion, the effort isn’t worth it as few people want to spend a weekend in technical analysis.

To trade on weekends, check your broker’s trading hours or contact customer support. If your broker closes on the weekend, there is nothing you can do except switch brokers. If weekend trading is your thing, check out our broker list for some helpful tips.

Some brokers will simply reflect the opening of that market – most remain open when the forex market opens. Tools like MetaTrader 4 (MT4) work on historical or live data, but only when the market is open.

Strategies

The market environment is different in the weekend environment compared to weekdays. This does not mean that you need an entirely new strategy, but you need to understand the unique nature of the market and match it with the right trading strategy.

There are three strategies to help you do this.

Strategy 1: Currency Trading Closing Intervals

Trading close intervals require ideal market conditions over the weekend. By dealing with the fatigue gap of calls over the weekend, you get the best environment for this type of strategy throughout the week. Weekend gap trading on forex is a popular system.

The gap is price rise. From one period to the next, something moves the market strongly, causing prices to rise from one price level to a higher or lower level, omitting the price in between.

Gaps occur for a number of reasons. For example, it may be the result of initiating a new movement or accelerating a movement. However, this gap requires high trading volumes. To initiate or accelerate a movement, many traders need to support change. Otherwise, your energy will run out quickly. There are too few traders on the weekend for this type of gap.

The big western bankers are at home on the weekends. Most day traders stay with their families and small investors take a break. The start of a new movement is impossible without this key player. You’re likely to see a bigger gap.

The gap closes when only a few traders make them. Sometimes, several people invest in the same direction because they are caught by coincidence or following the same instructions. The market goes up and down and the rest of the traders are puzzled. They consider the development a mistake, believing that the new price is too high or too low, depending on the direction of the gap. These traders mistakenly invest immediately in the opposite direction to make a profit.

  • If the gap is large, the trader sells the asset. The market will fall and close the gap.
  • If there is a gap down, traders will buy the market and close the gap.

Finding a divergence in a low-volume market environment is likely to close the matter. Weekends are a low volume trading environment, making them the perfect time to trade this strategy.

Knowing that the difference will disappear, you have everything you need to trade binary options with high payouts.

  • You know your price target. The market will move approximately until it reaches the price level of the first candlestick that makes up the difference. If there is a break up, it will drop to the level of the first candlestick. If there is a gap down, it will rise to the low of the previous candlestick.
  • You know the expiration. The market is likely to reach the target price within the next period. We recommend choosing a longer expiration only for very short periods.

This information allows you to trade high/low options, but you can also invest in one-touch options to create higher payouts. Choose an option with a target price within the gap and a duration less than 1. If your broker does not offer such an option, choose a high/low option with an expiry of one period.

We recommend using this strategy with currencies or commodities. With most of the world going bankrupt, we know that trading volumes for this asset type on the weekends are lower than during the week. On the other hand, Middle East stock markets are still trading volumes, so you can still experience a lot of trading volume. Therefore, the western weekend has less impact on trading volume.

Strategy 2: Trade Breakout Pullback with Currencies

This strategy uses a similar philosophy to the first strategy, but applies to other market phenomena (breakouts and pullbacks). A breakout occurs when the market completes price formation or breaks resistance or support. At these price levels, many traders place orders in the same direction, resulting in quick and powerful moves.

Massive trading volumes are needed to launch a sustainable movement. When the volume is low, support from most traders is lacking. Insufficient faith in a trade can cause a trader to invest in the opposite direction and get the market back. This move is called a pullback.

For example, suppose an asset is sideways pegged to a price channel. It tried to leave the channel a few hours ago but turned around every time the market approached the upper or lower limit.

Over the weekend, the market again attempts to break out of formation. This time we move past the border. During the week, this event can end formations and start new movements. But over the weekend, currency volumes are so low that the market is likely to pull back.

Usually reliable breakouts come with a lot of volume. Movement beyond the boundary of a structure accompanied by a low volume is likely a false sign. On the weekends, the potential for false signals is so high that it makes sense to predict pullbacks on all payouts.

You can trade fullbacks in several ways. These methods include:

  1. High/Low Options If you find a breakout on the weekend, invest in high/low options that you expect will push the market into formation. Use an expiration of about 2-4 cycles. For example, on a 10-minute chart, expiry times range from 20-40 minutes. This strategy will allow you to win a higher percentage of your trades, but creates a relatively low payout per winning trade. We recommend this strategy for risk averse traders.
  2. As a one-touch option. You win a one-touch option when the market touches your predefined target price. You can use the boundary of the price formation after the breakout on the weekend as a target price. The market seems likely to pull back, at least so far. If you use the longest expiry that still gives you a target price within this range, you are more likely to win the trade. This strategy is slightly riskier than using the High/Low option, but you will get a higher payout. Recommended for traders who want to take a little more risk.
  3. As a ladder option. The ladder option is a mix of one-touch options and high/low options. It defines a target price and you can predict whether the market will trade above or below this price when the option expires. If you notice a breakout over the weekend, you can use ladder options to predict that the market will soon trade again within the boundaries of the formation. Use maturities between 2 and 4. It’s the riskiest of these three strategies, but it’s also the one that creates the highest payout.

All three of these strategies can work equally well. Choose the one that best suits your personality.

Strategy 3: Trade Bollinger Bands with Currencies

Bollinger Bands define a price channel from which the market is unlikely to leave. Over the weekend, these price channels produce highly accurate forecasts, making them the perfect foundation for your trading strategy.

Bollinger Bands consist of three lines.

  1. The middle line. 20-period moving average.
  2. Above line. The moving average plus twice the standard deviation.
  3. Lower line. The moving average minus 2 times the standard deviation.

The bottom line acts as support, and the top line acts as resistance. The middle line can be either support or resistance depending on whether the market is currently trading above or below it. Generally, when a Bollinger Band is approached, the market will turn around.

Bollinger Bands can be a great help any time of the week, but they work better on the weekends. During the week, unexpected news can change the market environment, and many active traders can start a new move or end an old move at any time. As a result, the trading range is more diverse.

These events aren’t inherently bad, but they make using Bollinger Bands more difficult. When the standard deviation changes, the upper and lower Bollinger Bands change. A strong movement upwards or downwards will stretch the Bollinger Bands and widen the boundaries when riding. Predictions for these bands will quickly become obsolete.

On weekends, the market is much more even because of the lower volume. It is far less likely that a large group of traders will jump on a move and suddenly change the market environment, making Bollinger Bands easier and more accurate to use.

Here’s what this strategy does:

  1. Create a chart. Select an asset, open the price chart and see the BollingerApply the band.
  2. Wait for the market to approach the Bollinger Bands. Wait until the market is close to one of the 3 lines of the Bollinger Bands.
  3. Predict the market will turn around. Invest in high/low options where the market is unlikely to break through the Bollinger Bands.

This strategy is very simple. Even beginners can run it right away.

Conclusion

Weekend trading with binary options offers unique opportunities in a unique market environment. To take advantage of weekend trading, you need a broker that offers these trading hours and willingness to trade Middle Eastern currencies and commodities or stocks and indices.

A typical binary options strategy allows you to trade stocks and indices from the Middle East. However, when deciding to trade currencies and commodities, you should adjust your strategy to significantly reduce your trading volume on the weekends. There are ample opportunities that are well worth the weekend work and worth reading on.