One touch options, also known as touch or no touch option, is a type of binary options where you earn a profit when you predict correct the price of the asset go above or below the predefined goal rate at anytime during the life of the trade. There is no need for the price to maintain at the same level for a period of time. The final price of the asset at the expiry is not taken into account as long as the price touch the predefined goal rate during the life of the one touch options.
The predefined goal rate is set by the broker based on the data in the market. For example, if the USD/JPY is trading at 1.14 and the target price is 1.18. if you believe that the currency pair will reach 1.18 before the maturity, you can place a call. If you think it will drop, you can place a Put.
How Much Can You Earn with One Touch Options
One touch option is for traders who know which direction the price of the asset will move. Often, this type of option have a very profitable returns as you can expect a payout of 300% – 500% for in-the-money trade. It is very common for traders to reach 500% of profits for one touch options but the payout rate can reach higher to up to 600% sometimes.
The trade will end automatically when the price of the asset you predict successfully reach the goal rate. You don’t have to wait until it reach the expiry time. You will receive the payout in your trading account as soon as your trade arrives at the goal rate.
When Can You Trade One Touch options
Normally, traders will be able to trade on one touch options during the weekends. You can purchase it from 12 AM Saturday to 19:00 PM Sunday. After you have purchased the options, it will be traded from Monday 12 AM to Friday 17:10 PM. The options will be sampled once from Monday to Friday at 17:00 GMT.
The agreed payout will be credited into your account when the option expire at 20:00 PM on Friday. The expiry time frame usually will last until next Friday when the market shut down. If your one touch option did not reach the goal rate by that time, you lose the trade.
How to Trade One Touch Options
It is very easy to place a trade on one touch options. You simply have to select the asset which you predict will reach the goal rate. Next, you must select the price direction of the asset. You can reference the live graph at the platform to decide which direction of the price movement to choose.
Finally, you must enter the amount you want to invest. Before you place the trade, make sure the information are entered correctly.
Most brokers only require you to predict the direction, which is call or put and the investment amount. However, there are also some brokers that let you decide more. You should always carry out an adequate research in order to get the best returns. The chances of the asset’s price reaching the goal rate is affected by the condition in the market as well as the condition of the asset. Assets that are volatile has higher chances of winning.
Also read: Binary Options Strategies for Beginners
What Assets Can You Trade on One Touch Option
All four assets can be traded in one touch options including stocks, commodities, indices and forex pairs. Most of the time, traders will prefer to trade One Touch Option in the forex currency pair because of its high volatility in the market.
This doesn’t mean that indices and stocks are not suitable for One Touch options. One touch options is sold in units, with an average price of $50 for per unit. There are a number of brokers that offer it cheaper than $50. Your broker determines the return payout rate you will earn.
One Touch Options
As you can see, it is very easy to place a trade for one touch options. Despite that, it is not suitable for beginners because it is more complicated than the simple call/put options. You must know how to use the analysis tools for predicting the chances of the price of the asset you predict will reach the goal rate.
It is recommended that you first learn about the advanced trading strategies prior to trading. One touch option is ideal for traders who like to have some challenges in their binary trading.