A bearish strategy is employed when a trader believes that the price of a specific asset will follow a downward trend and loose value.
Binary Trading Example :
It’s 12:00 PM and the market has just had a significant rally. However, you think that within the next half hour the price of Gold will go below its current price of 1120 and follow the bearish trend.
You choose a Put contract that expires in 30 minutes and invest $1,000 , speculating that the Gold will be below 1120 by the time of expiration. If you are correct, you will receive $1,750, realizing a $750 profit ($750 = $1,750 – $1,000 of the investment).
It’s 12:00 PM and the market has just had a significant rally. However, you think that within the next half hour the price of Gold will go below its current price of 1120 and follow the bearish trend.
You choose a Put contract that expires in 30 minutes and invest $1,000 , speculating that the Gold will be below 1120 by the time of expiration. If you are correct, you will receive $1,750, realizing a $750 profit ($750 = $1,750 – $1,000 of the investment).
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