As the binary options market has evolved, so have the needs and requirements of traders. Experienced clients have requested options similar to traditional Rise/Fall binary options , but allowing trading according to volume and market volatility. Brokers also want to offer a product that can be traded in both flat and highly volatile markets. From here, the Options of Touch Touch / No Touch Continuity was born, allowing for trading with limited risk in terms of volume and volatility.
Touch options Explain
The ‘binary’ element of the One Touch option remains, as well as limited risk. Let an option of Touch Touch to complete the money; the asset value must touch or exceed the barrier (or ‘target’) level at least once before the option expires .
The No No No No option represents the opposite – the asset value will not reach the barrier (or ‘target’) level at any point prior to expiration .
In most cases, the barrier level is set by the broker. However, at certain brokers, traders can set up barriers. It may be higher than the current property value or it may be lower. The gap between the current asset value and the target price will often dictate the payout structure. These images represent trading Touch and No Touch successful ;
One significant difference with the Touch option, is that it can end up with the winnings before expires. If the Touch target is met, the option pays out immediately, no matter what happens to the asset value afterwards.
Broker difference
Traders who wish to use Touch options need to pay special attention to their choice of traders. Firstly, some brokers don’t offer them at all. Touch options at some other brokers are not particularly flexible. Nor is the target level. However, there are some brokers that offer a huge amount of flexibility. Here, traders can set their own target levels (the payouts adjust accordingly). This provides tremendous opportunity to use advanced trading techniques. Setting the Touch option at a time interval to control risk and return can guarantee a trading advantage. Traders can also set targets above and below current value, creating tunneling options.
When to use Touch Preferences
Advanced traders will be able to use One Touch options successfully throughout their trading day, others may specialize. For example, volume and market volatility can be expected to change significantly following the release of specific data or events. Likewise, a market can run smoothly for a period of time running up to an announcement – and be volatile thereafter. If a trader feels that trading volume will be particularly low or particularly high, the Touch option allows them to take a position on that view.
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