For example, a trader assumes that the price of the US dollar will be above $10 per share at 20:00 on a certain day, or the price of bitcoin will fall below $38,817 at 12:30 on Thursday. He indicates a certain amount of money that he would like to acquire if he guesses correctly, for example, $6. The trader then waits for the option to expire and sees if it happens at the specified time. If the prediction is correct, the trader receives $6 as an option premium. If he makes a mistake, he loses this amount.
Sometimes traders use trading robots that sell and buy assets. This kind of work is called automatic trading, a process in which a machine trades in the market based on a calculated algorithm. In the past, many traders used trading robots, but there are not many of them nowadays. The disadvantage of automatic trading is the predetermination of actions. On the contrary, a trader can think outside the box and make quick and atypical decisions.
When to trade?
The trading time depends on the asset. Trading starts with the opening of stocks, so a trader should start when a certain session starts. For example, if he is trading in pounds sterling or euros, he should start trading when the European trading session opens. Forex trading is only available on weekdays.
If you want to trade 24/7, take a look at cryptocurrencies. Crypto trading is available on weekends and holidays.
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If you trade on binary options signals, then you can familiarize yourself with the option trade signals.
