What is Touch Trading?
Touch and no touch options are among the simplest types of trading to understand – perfect for newcomers to binary trading. In short, a price goal is established by the broker of your choice, which the asset in question must either reach or surpass before the predetermined expiry time. As such, the trade may come to an end considerably earlier than the time at which the contract is set to expire.
If a trader has chosen the ‘touch’ option and the asset reaches its target within the allotted time, the trade is successful and the trader finishes in-the-money. If the target price is not reached, this particular trader would be unsuccessful, though a trader that chose the ‘no touch’ option would finish in-the-money. As with all standard forms of binary trading, there are only ever two possible outcomes – a simple all-or-nothing approach to trading.
Touch and no touch options are not only simple to understand, but extremely useful and valuable in a trader’s strategy/portfolio. This is particularly so during times of extreme market volatility, where determining the exact future price of an asset may be difficult, though predicting its temporary rise or fall may be much more plausible. Touch trading allows traders to take full advantages of temporary trends and patterns, alongside in-depth market analysis and real-time economic developments.