There are indeed several similarities between Boundary and No Touch binary options instruments. Both are intended for use when price movement is flat, or range bound. Both can typically used along with any type of asset, and both will include target prices which cannot be touched if the trade is to yield a profit. There are difference between the two, however, and all traders need to understand what these are in advance of making a selection.
The primary difference between the two would be the fact that the Boundary instrument includes both an upper and lower level, while No Touch involves only one. With Boundary, the price of the selected asset must remain between the two levels for the duration of the entire trade in order to finish in the money. With No Touch, the price of the selected asset cannot touch a specific (pre-determined) price while the trade is open. If it does, the trade closes as a loss. No Touch is often presented as a high yield trade, which will carry more risk than a standard trade.
Neither of these instruments should be selected when price movement is extremely erratic, or a trend is taking place. The analysis process should therefore include a check of recent market news, ensuring that no economic data or earnings releases are going to impact the value of the trade while the contract remains open. As for technical analysis, price charts should be used to confirm that price movement is relatively flat, as has been so for some period of time.
Risk can be determined by looking at the target prices. A Boundary trade with a small gap between the upper and lower levels will be riskier than one in which the gap is large. A No Touch trade is riskier when the entry price is already close to the target. The offered payout rates will coincide with the level of risk, so don’t expect a massive return when risk levels are low. There is absolutely nothing wrong with building up profits steadily, so there is no need to shy away from contracts offering a return of 65% to 75%.
Some asset groups are typically more volatile than others. Currencies are one example, as the Forex marketplace sees a huge trade volume daily. It can be helpful to note which assets tend to be the most stable in regard to price movement. These assets can then be analyzed again and again, with the goal being to find the best trade opportunities each day within your chosen binary options platform. Variety in a platform is nice, but having go-to assets to rely on is nice as well.
Selection between Boundary and No Touch should be done on a per-case basis. Considerations will include the current price movement, analysis findings, and the space between the entry price and the target(s). Expiry time selection will also be important, as lengthier periods will increase risk due to the fact that more time is allowed for the target levels to be exceeded. Although there are many things that need to be considered, at times, these types of binary options trades will offer up some extremely easy profits.