The Forex Options Course: A Self-Study Guide to Trading Currency Options
The Forex Options Course is designed to help forex traders build upon their knowledge and skills in trading forex and apply it to forex option strategies.
Introduction:
There are important differences between spot forex and options trading. In contrast to the spot forex trader, the options trader puts on trades “anticipating” a move over a longer duration of time.
Whereas the spot forex trader concentrates on trades to achieve profits intraday and even intrahour, the option trader is liberated from the slavery of the screen and can set and let fundamental and market forces generate the intended profits. Position trading strategies become an important part of the repertoire of the forex option trader.
Forex option trading also is accompanied by an entirely different mind-set from spot trading. While neither one can claim superiority over the other, there are significant consequences to pursuing a forex option mind-set. The differences between the forex spot and option trading perspectives generate different strategies and goals and also a different need for information.
For example, the spot trader often seeks frequent small moves and focuses on intraday and intrahour charts, avoiding the need for constantly absorbing information on fundamentals and the big picture. In contrast, the forex option trader’s decision to put on a trade is a result of a more intense evaluative process where the trade fits optimal conditions, since forex option trading is less frequent than spot trading.
Forex option trading requires more experience evaluating broad market conditions and top-down analysis, while forex spot trading requires greater focus on trading itself with precision management of moment-to-moment trading.
Contents:
- The Elements of an Option Trade
- What Affects Forex Option Prices?
- Finding Direction for Your Forex Option Trade
- Tracking Fundamental Directions
- Chart Patterns and Trade Entry
- Using Experts to Shape Trading Decisions
- Vanilla, Spreads, and Volatility Strategies
- Binary Option Strategies
- Option Strategies for Extreme Outcomes and Scenarios
- Putting It All Together
