Best Binary Options Broker 2020!
Ideal for beginners!
Free Demo Account + Free Trading Education!
Get a Sign-up Bonus:
2nd place in the ranking!
Why Trade this System?
One of the main reasons we chose the EURUSD as the underlying asset of choice to trade this system is because it is the currency pair that is traded the most in the forex market. This ensures that as a binary options instrument, it is available for trading all day long and will have good liquidity, enabling you to get good pricing. You will not have to buy costly bets that will have a greater risk than reward.
If you are starting out in binary options trading, this is a great way to start your trading career. This system can be used to trade the Rise/Fall variety of binary options. If your broker does not offer this trade type, you can opt for the High/Low variety or the Touch/No Touch binary option.
Setting Up the System:
Most binary options brokers do not provide charts for use in trading analysis, so you have to get the charts yourself. Since the underlying instrument is a forex instrument, you can easily get a chart by downloading an MT4 platform from any of the popular forex brokers like forex.com.
Recommended Brokers for Trading EUR/USD
The strategy in question is to be implemented on a 30-minute chart, and the strategy will make use of the following indicators:
1) MACD (12, 26, 9): This is a momentum indicator that shows the strength of the signal.
2) Parabolic SAR (default settings of 0.02, 0.2): This is a trend signal.
Best Binary Options Broker 2020!
Ideal for beginners!
Free Demo Account + Free Trading Education!
Get a Sign-up Bonus:
2nd place in the ranking!
Here are the trade rules for this strategy.
BULLISH SENTIMENT: In order for the EURUSD to go bullish, we wait for the Parabolic SAR indicator to indicate a buy signal, which occurs when the stars of the Parabolic SAR indicator appear below the price action on the chart. We also wait for the MACD lines to cross from negative to positive.
BEARISH SENTIMENT: In order for the EURUSD to go bearish, we wait for the Parabolic SAR indicator to indicate a sell signal, which occurs when the stars of the Parabolic SAR indicator appear above the price action on the chart. We also wait for the MACD lines to cross from positive to negative.
Once you have got a confirmation of the signals, the next step is to choose the binary option trade of your choice. For this example, I will recommend choosing the Touch/No Touch option. This is easier to predict than a Rise/Fall or a range option, as all you need is a touch, (or no touch) to make money on this trade.
If you are bullish on the EURUSD, you can decide to purchase a Touch option contract, selecting a strike price to the upside. Make sure you identify the resistance points and keep your strike price below the resistance so you can be sure the price action will actually touch the price barrier you have set. You can then purchase a “No Touch” option contract, selecting a price barrier to the downside. In this instance, you can set your price barrier well below the nearest resistance so the price action has no chance whatsoever of touching your price barrier.
Repeat the same trade sequence in reverse fashion if your signal indicates a bearish outcome. Whichever trade you decide to take, you should at least have 4 different trade options to benefit from:
- Touch – Price barrier between market price and nearest resistance.
- No Touch – Price barrier below the nearest support.
- Touch – Price barrier between market price and nearest support.
- No Touch – Price barrier above nearest resistance.
Representing the world’s two largest economies, it is perhaps little surprise to learn the EUR/USD is the most popular traded currency pair in the world. But whilst rich volatility and volume attract day traders from all over the world, generating substantial profits is no straightforward feat. This page will break down the history of the EUR/USD, why to trade it and how to trade it in 2020, including online charts, signals, strategy, exchanges, news and more.
EUR/USD Trading Brokers
Why Day Trade EUR/USD?
As the most popular of the major pairs, the EUR/USD trade vehicle is often highlighted on trading platforms and exchanges. But why do so many day traders opt to pursue profits from this pair?
- Prevalence – They are the two most popular reserve currencies. Their size leads to an abundance of financial data on the pairing being released. This also makes them relatively straightforward to follow.
- Liquidity – The EUR/USD promises consistent liquidity, plus low bid-ask spreads.
- Volume – The huge numbers of active traders and market speculation ensure relatively high levels of volatility. All of which can lead to greater profit potential.
- Availability of resources – In some ways, short and long-term forecasts are now easier to make. You have access to historical graphs, candlestick and monthly charts, plus customisable indicators. Conducting Elliott wave analysis is more straightforward, for example. In addition, you have online active trading communities. These are often full of weekly forecasts and predictions for today.
So, with historical data downloads just a few clicks away and spreads plastered across the internet, intraday traders have plenty of access to the necessary information.
Despite a number of benefits to trading the EUR/USD pair, there also exist certain drawbacks:
- Volatility – The high levels of volatility within the EUR/USD pair can result in winning positions swiftly turning into losing ones. Often, no amount of historical data and 20-year charts can prepare you for the speed at which prices can swing.
- Leverage -Admittedly, trading on margin may increase your potential profit. However, it can also amplify losses. So, if you do utilise leverage, making accurate daily and next week forecasts is essential.
- Automated competition – Unfortunately, even with attractive forward and live quotes, competition is now fierce. You are trading against an increasing number of trading algorithms. You have to manually analyse and react to a bullish market with your interactive chart. However, bots will automatically enter and exit positions once certain criteria have been met.
Influences on Movement
Another crucial factor is the political landscape. Instability, as seen in the Brexit referendum, can all influence the direction of the currencies. Yet it isn’t just major elections that play a part, events such as Switzerland’s decoupling from the euro peg will also hit exchange rates.
The challenge comes in keeping an eye on the numerous countries within the eurozone. So, keep abreast of the latest political and economic news.
Combine recent events with EUR/USD historical data on a simple Excel. This will allow you to make more accurate forecasts for 2020 and beyond.
You will find your EUR/USD live analysis makes far more sense if you have a thorough understanding of what influences direction.
The biggest factor is the strength and outlook of the two economies. Put simply, if the European economy grows faster than the US economy, the euro will strengthen against the dollar, and vice versa.
A telling gauge of economic strength is interest rates. For example, the dollar normally strengthens when US interest rates are higher than those of big players in European economies.
As touched upon above, there is also a correlation between monetary policy implemented by the respective central bank and the EUR/USD relationship. This was seen in the 2007 global financial crisis, which was one of the greatest reductions in the euro vs USD history.
During this period, there was an unusual separation between the policy from the US Federal Reserve (Fed) and the ECB in particular.
The Fed looked to aggressively stimulate the US economy early on, with QE measures. The ECB, however, delayed QE measures. The US were purchasing sovereign bonds as a stimulus measure for years before the ECB followed suit.
The two also had somewhat different priorities. Whilst the Fed aimed to increase employment as well as stabilise prices, the ECB was mainly concerned with price stability.
The effect was most forex news stories focusing on the actions of the Fed, whilst the ECB took a back seat. Throw in that many member states were struggling with crippling debt and people soon began to question the longevity and efficacy of a universal monetary policy.
Unsurprisingly, this all led to strange fluctuations between the EUR/USD. Today, therefore, many that are investing focus on projections and expectations of central bank policy to help them form strategies around the EUR/USD.
Whilst you may focus your trading efforts on the EUR/USD, there are certain correlations with other currencies to be aware of. You will notice that some currencies feature in numerous currency pairings. This is because all currencies are interlinked. None of them trade entirely independently of each other.
Their relationships are known as positive and negative correlations.
- Positive correlation – This is when pairs react in line with each other. The three most popular pairs, GBP/USD, AUD/USD, and EUR/USD, are all positively correlated. This is a result of USD being the counter currency. So, any change in the US dollar will impact all the pairs.
- Negative correlation – This is when currency pairs react in the opposite direction. Popular pairs include USD/CHF, USD/JPY, and USD/CAD. For those unsure which is the base currency, it is the US dollar. This means they move in the opposite direction of the previously mentioned majors where the US dollar plays the counter.
A EUR/USD trader can use this knowledge to better understand the implications of movement in certain pairs. Let’s take the British Pound vs the US dollar, for example. When trading this pair, to an extent, you are also trading the Euro vs the British pound.
Unfortunately, it isn’t quite that straightforward. Economic factors and market speculation can result in shifts in currency correlations. A negative correlation may turn positive and vice versa.
EUR/USD Day Trading Strategy
An effective EUR/USD strategy is more than understanding how you can use pip values and calculators to your advantage. It’s also more than getting a feel for premarket sentiment. It’s about using your investing chart in realtime to consider tick data and weigh up your options.
Once you have a solid grasp of how EUR/USD market forces interact, you will need to turn your attention to a strategy. 5-minute, 30-minute, weekly, and all-time charts may prove useful, but knowing when to trade is just as important.
Part of the attraction of forex day trading is that you can buy and sell 24-hours a day. Whilst this is true, it doesn’t mean you should. Instead, you want to trade when the EUR/USD pair is active, with plenty of volume and volatility.
For example, when London and Europe are open for business, pairs that feature the British Pound and euro are more actively traded. If you’re day trading with EUR/USD, volume charts show the most active period is when both London and New York are open. These markets are open between 08:00 and 22:00 GMT.
The danger is, if you trade at the wrong times, the cost of spreads and commissions can cancel out your profits. So, many suggest only trading within a three to four-hour window.
So, when is the best time to day trade EUR/USD binary options, futures and other instruments?
The ideal time is from 13:00 to 16:00 GMT. This three-hour window is when London and New York are both open. Volume from both markets means spreads are normally tightest during this window.
This is also when forex forums come alive and you’ll see the biggest daily moves. All of these factors can result in the greatest profit potential. So, whilst it may be tempting to respond to every buy sell signal you see today, resistance may prove sensible.
Try not to let graph and market noise pressure you into trading on 12-hour intraday forecasts. Focus on what you know and ensure volume validates any potential moves.
Buying & Selling the Breakout/Breakdown
EUR/USD live charts and technical analysis will be needed to succeed with this strategy. You will find the pair swing back and forward within boundaries for considerable periods. This creates clear trading ranges, which should lead to new trends, higher or lower.
Bide your time during the consolidation phases. The reward could be low-risk trade entries when you spot that resistance and support levels ultimately break, leading to a rally or sell-off.
This technique relies on timing. Enter your position too early and you may find the range holds and a reversal is triggered. Go in too late and your risk increases as the position may execute above new support or below new resistance.
Narrow Range Patterns
You will frequently see the pair climb or drop into a substantial barrier and then fall dormant, creating narrow price range bars, leading to minimal volatility. This also results in powerful entry signals for breakouts and breakdowns though.
So, enter your position within the narrow range pattern, placing a tight stop to prevent losses from a major reversal.
The benefits of this method are that the straightforward pattern often predicts price bars will increase in significant breakouts and breakdowns. In addition, it’s low risk as you can place stop-losses close to the entry price.
When it comes to day trading Eur/USD, different strategies work for different people. Some prefer using pivot points, swap points, and forward curves, others will focus on trading around news announcements. Whether you opt for chart investing or not though, be patient, perfecting a strategy takes time.
Wind back the clock twenty years, before the mini futures and binary options of today, and the forex markets were a different place. It was the German Deutschmark vs US dollar, plus the French franc vs US dollar that dominated the scene.
However, January 1st 1999 set the wheels in the motion for foreign exchange history. But the road to the euro had been paved decades before that.
There existed two earlier versions of the euro, both were internal accounting units for European Community (EC) members. They were:
- European unit of account
- European currency unit (ECU)
Neither were ‘real’ currencies. They were groups of specific EC currencies, engineered to help stabilise European exchange rates. Together, they helped form the single currency we all know today.
The ECU section of currencies had a somewhat alternative makeup to those that were to form the euro. But the ECU still played a key part in the historical exchange rate of the euro. The value of one euro was set as the value of one ECU, when it was first created on January 1st, 1999. So, the initial EUR/USD exchange rate was 1.1686.
Despite this, the euro wasn’t to become a physical currency until 2002. However, the 1999 launch brought all the eurozone currencies together, including:
- German Deutschmark
- French franc
- Spanish peseta
- Italian lira
It was at this point, they stopped having separate, floating historical foreign exchange rates. They were bundled together until they were engulfed into the currency of today.
EUR/USD history data and opinion of the time showed many had expectations the euro would steal the dollar’s unofficial title as the global reserve currency. However, this is a mountain it is yet to climb.
Those that monitor the EUR/USD today are better able to forecast price movements, by taking into account previous events. Some of the most important of which, are as follows:
- 18th September 2007 – The Federal Reserve System cut fed fund rates by 50 basis points. As a result, this saw the euro strengthen against the dollar.
- 16th December 2008 – Federal Reserve System cuts rates to nearly zero. Again, this saw the euro strength against the dollar.
- 19th October 2009 – The new Greek government amends latest deficit forecasts from 6.7% of GDP to 12.7%. This had the effect of weakening the Euro against the dollar.
- 1st June 2020 – Moody downgraded Greek debt by seven notches to junk status This further saw the euro weaken against the dollar.
- 18th December 2020 – Federal Reserve System states ‘tapering’ of stimulus will commence in January 2020. Euro continues to weaken against the dollar into February of 2020.
- 14th July 2020 – The president of European Central Bank (ECB), Mario Draghi, prepares the market for quantitive easing (QE). As a result, the euro weakens against the dollar.
- 22nd January 2020 – The ECB introduces full-blown QE. This causes the Euro to weaken against the dollar.
EUR/USD exchange rate history and data demonstrate the effect of central bank action on price. So, perhaps those that analyse the Federal Reserve System will be more able to accurately predict fluctuations in the world’s most popular currency pairing.
On top of the factors highlighted in the timeline above, wars, elections and output levels have all influenced the EUR/USD in the past too.
There are also a number of other events that have triggered substantial EUR/USD volatility. The biggest of which include:
- Dot-com bubble – 1997-2001 saw speculation that rocked the EUR/USD relationship. It took years for the dust to settle and stability to arrive.
- Real estate bubble – The bubble was thought to be a key driver of the 2007-2009 recession that was hugely damaging to the US economy.
- European debt crisis – The impact of the European Debt crisis is still being felt today, and has had a significant impact on the relationship between the two currencies.
It is worth highlighting, those with an understanding of the past, are often in a better position to predict future price shifts.
Role of the US dollar
The EUR/USD related index you look at today will have been shaped to some extent by the unique role the US dollar has played over the years. These are just a few of the reasons it has grown to become the world’s most important currency:
- Considered the world’s reserve currency, it is used to settle the majority of international transactions.
- Many small countries will peg their currency’s value to that of the US dollar, whilst global banks will hold a large portion of currency reserves in US dollar.
- You will also notice the live price of gold and other commodities is often set in US dollars.
- The Organization of Petroleum Exporting Countries (OPEC) also conduct transactions in US dollars.
- It is the most featured currency in popular pairs, so as an aspiring forex trader, you need a solid understanding of what drives the US economy to predict where the US dollar will go.
Role of the Euro
The European Union is the biggest economic region. Its nominal GDP in 2020 is around $18.3 trillion. What some don’t realise when they look at their EUR/USD live chart, is that the euro’s growth is predominantly driven by services and manufacturing. As such, when economic activity slows in the EU, the euro usually weakens.
The euro is unique because 19 of the 28 European countries within the EU use it. Around 400 million people buy and sell with euros every single day. As the euro’s popularity has grown, so have the implications of economic and political events in the EU. So, whilst many traders focus on the catalysts behind the US dollar, to be a successful FX trader, the euro warrants your attention also.
When day trading the EUR/USD there are a number of factors to take into consideration. Economic data releases, central bank statements, and the latest news are just a few considerations your strategy must take into account.
If you want to join the likes of Andrew Krieger and Bill Lipschutz in the forex hall of fame, you will also ensure you choose suitable trading hours. You may be able to trade 24 hours a day, but the quality of trades often trumps quantity. Finally, conducting EUR/USD fundamental analysis through charts and patterns is essential.
For more day trading guidance, see our forex page.
The Best Binary Option Signal Providers and Services of 2020
Many people earn extra cash through binary options trading. However, without the right tools, inexperienced traders can stand to lose far more than they anticipated. For anyone interested in making the most of binary trading, signals provide an authoritative resource for quality advice.
Traders of all experience levels can better understand the course of the market by paying attention to signals and using signals services.
Though many higher-level binary options broker accounts come with the benefit of an account manager, signal providers may have a more calculated and readily available approach, using software and algorithms to provide actionable insights for brokers.
Signal services do the hard work that would require a person to stare at a computer screen for days. Signal services can detect—and advise on—even the smallest changes in market trends and accurately direct traders toward new assets.
Table of Contents
The Best Binary Options Signals of 2020
Binary Options Pro Signals
Binary Options Pro Signals (BOPS) is a subscription service that offers automated trading alerts sent to you in real-time via email or SMS. BOPS uses sophisticated trading algorithms and advanced indicators to accurately predict short-term market direction. With this provider, you’ll receive up to 18 trading signals per day, which is more than most signal services.
When you subscribe to Binary Options Pro Signals, you’ll instantly start receiving trade alerts based on 14 different assets that BOPS monitors. These assets include stocks, indices, and currencies. The signals will include ASSET, entry price, market direction (call or put), and the expiry time. After receiving the trade alert, all you have to do is login to your preferred broker account and place the trade.
The win rate for these signals is an impressive 71.20%, which is above average for the industry. If you want to test-drive this service, you can take advantage of their free 7-day trial. After the trial period, subscriptions cost $97 per month. If you’re looking for a reliable signal provider and an impressive win rate, you can’t go wrong with Binary Options Pro Signals.
Binary Options Trading Signals (BOTS)
With over 15 years of proven trading experience, Binary Options Trading Signals (BOTS) is one of the top-ranked signals services in binary trading. Specializing in Forex and Nadex options, BOTS is an excellent source of automated trading signals.
Offering a free morning trial, BOTS prides itself on providing a unique strategy based on easy-to-read proprietary charts. The service delivers a quality trading education on the different types of trading markets. It also guides users through the most important ins and outs of binary trading.
Like other signals services, BOTS provides real-time signals to traders looking to place profitable trades. However, unlike less-detailed signals services, BOTS explains the “why” component of their signals. BOTS prioritizes traders’ understanding, answering user questions on risk management, and the importance of discipline in binary options trading. BOTS has built a trading community based on knowledge-sharing and educational resources.
Auto Binary Signals
Auto Binary Signals is a binary signals provider that has been around since 2020. Rather than sending trade alerts to your smartphone or by email, the signals are available through their web-based membership area.
This means you have to actually login to your members area in order to see the trading signals, which could be a disadvantage for those looking for real-time alerts.
Auto Binary Signals works by automatically filtering through thousands of potential market opportunities in real time. A signal is only generated when there is an 80% chance or higher of winning a trade. The trade alerts are generated using a sophisticated strategy that uses 5 different indicators. A signal is only generated when all 5 indicators are aligned at the same time.
Rather than having a monthly recurring charge like other signals providers, Auto Binary Signals provides access to their signal software for a one-time payment. This software tracks all major currency pairs, commodities, and a few stocks. Auto Binary Signals provides two different types of option ranges: short-term (1-5 minutes) and long-term (15 minutes to 1 hour).
Overall, this signal provider has its pros and cons. It’s win rate appears to be very high, but the fact that it doesn’t send you alerts to your smartphone or email in real-time can lead to missed trading opportunities.
Signals365 is a signals provider that provides over 100 daily signals across 8 major currency pairs including EUR/USD, GBP/USD, USD/JPY, USD/CHF, EUR/GBP, AUD/USD, NZD/USD, and EUR/JPY. These trading alerts are accessible 24/7 through their web-based platform. Each signal includes data such as Asset, Expiry Time, Entry Time, Strikeprice, and Market Direcition.
Unfortunately, Signals365 does not send binary option signals via SMS or email. They can only be viewed in your members area once you login. According to their website, their signals are generated using proprietary technology that predicts trends and price reversals. Their automated trading strategies have gone through extensive backtesting and optimization over the years.
In order to maximize your win-rate and avoid poor market conditions, Signals365 pauses their signals during major economic events, public holidays, and low trading periods.
Signals365 does not charge for their signals. Instead, their service is free, as long as you sign up to one of their preferred brokers.
Types of Binary Options Signals
Basic signals are easy-to-follow notifications communicated to traders directly and in real-time by SMS or email. Basic signals are the most simplistic form of signals and don’t necessarily provide the in-depth explanations or charts that other signal types may provide.
Basic signals will advise traders on the direction of trades and suggest whether a trader should “put” or “call” on a trade. Because they’re not as complex as some other signal types, basic signals enable traders to make quick decisions that can often return highly profitable results.
Many signals services will entice new users to their service by offering free binary options advice. While it’s a good way for inexperienced traders to test a service or understand how binary options signals operate, free signals are unlikely to provide profitable advice. Like demo accounts, free signals are a risk-free foray into how trading binary options work without trading real funds before you’re ready.
Working closely with an account manager through a broker provides extensive benefits traders may not find working on their own. However, signals software offers real-time notifications and keeps track of signs a human might accidentally miss.
Using MetaTrader4 (MT4), signals software gives real-time updates and algorithmic advice to traders of all skill and experience levels.
There’s no shame in using signals software to stay on top of the best binary options trades of the day; many professionals utilize the software, as well.
Most software currently available can be downloaded directly to your smartphone, tablet, or PC and alerts you of the best trades by text message or email notification.
Factors to Consider When Choosing A Binary Options Signal Provider
Before choosing the best binary options signals service, it’s important to investigate the success rate of the provider. Signals services such as Signals 365 and Auto Binary Trader prioritize transparency and publish their daily results to their website. By publishing the good and the bad results, these signal providers maintain trust in their traders.
It’s typical for signals providers to boast 70% or higher success rates, but there is no way to investigate these claims if the provider is not transparent about their results.
Number of Signals and Frequency
Binary options signals aren’t worth much if traders don’t have access to them. Before choosing a signals service, consider the frequency in which the provider will send signals to you, the hours they operate, and the number of signals they’ll send at any given time.
The signals should be frequent and quick, enabling you to make the best trades before the trade window expires. Fully automated signals services will send frequent signals, but they may lack some of the accuracy of signals providers that combine software with human insight.
Binary options signals providers enable traders to make quick decisions that produce highly profitable results. The frequency and number of signals sent can affect profitability. Traders may want to look for services with higher update rates.
Traders also need to take the cost of binary options signals into account. Similar to brokers, signal providers may offer a variety of tiers to their traders. Before committing to a signals service, traders should compare and contrast what each service provides for the price.
Because all binary options trades come with a degree of risk, traders must also factor in the frequency of signals and the success rate of the signal provider and compare these factors with the cost. If the success rate is too low and the updates are not frequent enough, a higher priced service may not be worth as much to traders.
Before choosing your signal provider, it’s worth looking into whether or not the service offers a trial before you subscribe. Signal service trials may not yield high profits for traders, but will provide insight into how the service operates, how quickly it alerts traders of changes in trends, and how beneficial the advice may be to the trader’s bottom line.
Some signal service providers differ in how they alert traders of important signals. Some binary options signals only deliver signals while a trader is specifically logged on to their app or website. That means the trader could miss important alerts. Other services readily update traders of signals via SMS, email, skype, GroupMe messages, and app-notifications in real-time.
It’s crucial to consider the delivery method of notifications when choosing a binary options signal provider. No matter how good the data is, it doesn’t mean much if traders can’t act quickly on the information.
Robert Wolfe is the founder and chief editor of Impact Investing Collaborative. Robert is an expert trader with over 10 years of experience trading binary options, Forex, and CFDs. He prides himself in providing accurate and in-depth reviews in order to help others find a trading platform that fits their needs. When Robert isn’t actively trading or managing Impact Investing Collaborative, he enjoys spending time with his 3 kids, playing golf, and spending time outdoors.
Welcome To Our Site!
My name is Robert Wolfe and I’m an online trader with over 7 years of experience trading financial instruments such as binary options, CFDs, forex, and stocks. I created this website to share my knowledge of the industry so you can avoid the same mistakes I’ve made.
Best Binary Options Broker 2020!
Ideal for beginners!
Free Demo Account + Free Trading Education!
Get a Sign-up Bonus:
2nd place in the ranking!