Today’s Binary Options Trading Strategy:
• Currency Pair: AUD/USD
• Timeframe: H4 (Hourly Chart)
• Binary Option Trading Recommendation: Seek binary call options on dips below 0.7630
• Upside Potential: The upside potential for this binary call option is 305 pips to 0.7935
• Downside Potential: The downside potential for this binary call option is 95 pips to 0.7535. The AUD/USD stabilized inside of its horizontal support level after a strong corrective phase guided this currency pair from its intra-day high of 0.7938 which was recorded on March 24th 2015 to its intra-day low of 0.7533 which was reached on April 2nd 2015. The most recent intra-day low represents a false breakdown below its horizontal support level, but last Friday’s disappointment out of the United States non-farm payrolls report provided the catalyst which pushed the AUD/USD back inside of its horizontal support level. The initial bounce recorded an intra-day high of 0.7695 on April 3rd 2015 and a steep descending resistance level emerged.
Price action is currently trading inside of its horizontal support level from where further downward pressure is being deflated. The AUD/USD is anticipated to breakout above its horizontal support level and accelerate back into its horizontal resistance level. Binary options traders can profit from the expected breakout with binary call options. Today’s binary options trading strategy suggests call options to be placed on dips below 0.7630 for a risk/reward ratio of 1.0/3.21.
Volatility decreased during the corrective phase and despite the false breakdown below its horizontal support level, volatility remained contained. An increase in volatility is expected as price action is trading in a very steep triangle formation. Sellers are likely to pressure the AUD/USD to the downside in order to challenge its most recent intra-day low which is not expected to be violated. Buyers are favored to force a breakout above its descending resistance level as well as above its horizontal support level in order to accelerate to the upside; guided higher by its ascending support level.
The AUD/USD will face its first resistance level at its intra-day high of 0.7695 which was reached on April 3rd 2015. This level marked the high recorded during its bounce off of its most recent intra-day low. A breakout above this level will take the AUD/USD to its intra-day high of 0.7847 which was recorded on March 18th 2015. This level marked the intra-day high after the disappointment delivered by the US Federal Reserve. The final resistance level is located at its intra-day high of 0.7938 which was reached on March 24th 2015 from where a double top formation may emerge.
The following economic data out of Australia already impacted the base currency, the Australian Dollar, of the AUD/USD currency pair:
Retail Sales for the month of February:
• Expectations: A monthly increase of 0.4% was expected for February
• Previous Report’s Data: A monthly increase of 0.5% was reported in January
• Released Data: A monthly increase of 0.7% was reported in February
• Impact on the Australian Dollar: The reported increase in Australian retail sales sufficed to apply upward pressure on the Australian Dollar; this favors binary call options in the AUD/USD currency pair
In addition the following economic report out of the United States is expected to impact the quote currency, the US Dollar, of the AUD/USD currency pair:
Consumer Credit for the month of February:
• Expectations: A level of $12.650 is expected for the month of February
• Previous Report’s Data: A level of $11.562 was reported in the month of January
• Impact on the US Dollar: The anticipated increase in US consumer credit is unlikely to support a stronger US Dollar which favors binary call options in the AUD/USD currency pair