In the meantime, binary options traders should adjust their strategies to reflect this emerging reality. The key to this is to understand that fluctuations on main indices and even on the price of commodities such as oil, will probably be very moderate. This means that traders will have to understand well which side of the trade to play, and really focus on the time frame of their trade.
The possibility of an interest rate hike by the Fed, especially if catches the market by surprise, will probably have a disproportionate effect on currency pairs. The USD can be expected to strengthen against almost all other currencies as a result. Binary options traders should be especially careful with these fluctuations, because they can throw off any calculations made previously. It is possible that some of the gains that other currencies have made against the US dollar recently, on which many binary options traders were counting on as a corner stone of their investment strategies, will recede.
An interest hike by the Fed, can also serve to lower the prices of key commodities marginally, especially that of oil. Since the price is quoted in USD, when the value of the USD increases, the prices adjust to reflect the new reality. This is another variable that traders must take into account when adjusting their trading strategy, although the fluctuation should not be too aggressive.
In general, this environment might prove to be challenging for some binary options traders who adjusted their strategies to take advantage of the small Bull Run that took place over the last 2 weeks. This is a good time for investment strategists to go back to their proverbial drawing board, and adjust the plays on their book. This is especially true if markets and indices will keep on showing signs of stability, because binary options traders generally find it more difficult to work in an environment in which fluctuations are not aggressive.
Investment strategists should take into account the fact that economic data might not generate a surprise that could send shock waves through the markets. In either case, binary options traders are strongly advised to take a look at their current investments and their strategy, and recalculate if necessary, in light of the current environment.
