A call option in digital option trading is a contract that a trader buys when they expect the price of an asset to be higher than the strike price (the price of an asset at the moment when a market participant buys the contract) at a predetermined moment in the future, which is known as expiration. If the price at expiration is above the strike price, the deal is profitable, and you receive fixed gains (typically, 85%+ of the investment amount). On the contrary, should the quotes move below the strike price and stay there until expiration, a loss occurs.

When buying a call option (Higher contract on the Binolla platform), you expect the price to move above the strike price without the need to calculate how much it goes in your direction. Even if the difference between the strike price and the quotes at the moment of expiration is only one pip, the deal will close with a profit. 

Example

A trader watches the EUR/USD chart, and the current price is 1.1700. They conduct technical analysis and expect the quotes to move higher from this point. They decide to buy a Call (Higher, Up) contract to capitalize on this market opportunity. They set the expiration time at 1 minute and invested $100 in the contract with a profitability of 90%. 

The price then moves to 1.1705 by the end of the minute. The digital option closes with a profit, which is $100*90% = $90. The investment amount is also credited back to the trader’s balance

If, under the same conditions, the price of the asset reaches 1.1699 or lower at expiration, the trader loses $100. 

How to Buy a Call (Higher) Option at Binolla

Buying a Call (Higher) contract at Binolla is simple. Here is how you can do it:

1. Choose an asset and a type of contract.
2. Set the amount that you are going to invest in the trade.
3. Select expiration.
4. Press the Higher button to open the trade. 

When to Buy a Call (Higher) Option

Traders can use various strategies to purchase a Call (Higher) option. The most common ones include:

• Trend continuation. When you expect that the current trend is going to continue, you can purchase a Call (Higher) option. To work with this strategy, you can use various indicators like moving averages and Bollinger Bands.
• Breakouts. Traders buy a Call (Higher) option when the price breaks above the resistance level. To apply this strategy, you can use a classic resistance line, Bollinger Bands, moving averages, bullish or bearish channels, bullish flags, and wedge patterns.
• Reversals. Traders buy this type of contract when they expect the downtrend to end and the uptrend to begin (or at least an upside correction to start). To use this approach, you can apply RSI, Stochastic, bullish reversal candlestick patterns, graphic patterns like inverted H&S, Double or Triple Bottom, and Bollinger Bands.