Today’s Binary Options Trading Strategy:
• Currency Pair: EUR/JPY
• Timeframe: H4 (Hourly Chart)
• Binary Option Trading Recommendation: Seek binary call options on dips below 135.000
• Upside Potential: The upside potential for this binary call option is 195 pips to 136.950
• Downside Potential: The downside potential for this binary call option is 115 pips to 133.850
The EUR/JPY is seeking direction after a move to the downside took this currency pair from its intra-day high of 136.957 which was reached on May 18th 2015 to its intra-day low of 133.094 recorded on May 26th 2015. A descending resistance level emerged from its most recent intra-day high which has exercised downward pressure on the EUR/JPY. This led to a false breakdown below its horizontal support level, but the corrective phase was reversed by its ascending support level which pushed this currency pair to the upside. The contraction was mentioned by outlets which provide profitable tips for binary options trading.
Price action is currently trading above of its horizontal support level after its ascending support halted and reversed the move to the downside. The EUR/JPY is expected to breakout above its descending resistance level from where it can charge ahead. Binary options traders can profit from the anticipated continuation of the advance with binary call options. Today’s binary options trading strategy suggests call options to be placed on dips below 135.000 for a risk/reward ratio of 1.0/1.70.
Volatility decreased during the corrective phase which resulted in the false breakdown below its horizontal support level, but a sharp increase in volatility is expected as the EUR/JPY is trading inside a narrow triangle formation. Sellers are anticipated to keep the downtrend intact with a breakdown below its ascending support level; any potential breakdown is likely to be limited to its ascending support level. Buyers are favored to push the EUR/JPY into a breakout above its descending resistance level from where this currency pair can advance to its horizontal resistance level.
The EUR/JPY will face its first resistance level, after a successful breakout above its descending resistance level, at its intra-day high of 135.337 which was recorded on May 22nd 2015. This level represents the high prior to the false breakdown. The next resistance level awaits the EUR/JPY at its intra-day high of 135.992 which was reached on May 7th 2015. The descending resistance level originated from this point. The final resistance level is located at its intra-day high of 136.957 recorded on May 18th 2015.
The following economic data out of the Eurozone is expected to impact the base currency, the Euro, of the EUR/JPY currency pair:
Eurozone Business Climate Indicator for the month of May:
• Expectations: A level of 0.35 is expected for the month of May
• Previous Report’s Data: A level of 0.32 was reported in the month of April
• Impact on the Euro: The expected increase in the Eurozone Business Climate Indicator is likely to pressure the Euro to the upside which favors binary call options in the EUR/JPY currency pair
In addition the following economic report out of Japan already impacted the quote currency, the Japanese Yen, of the EUR/JPY currency pair:
Retail Trade for the month of April:
• Expectations: A monthly increase of 1.1% was expected for April, an annualized increase if 5.5%
• Previous Report’s Data: A monthly contraction of 1.8% was reported in March, an annualized contraction of 9.7%
• Released Data: A monthly increase of 0.4% was reported for April, an annualized increase if 5.0%
• Impact on the Japanese Yen: The reported increase in retail trade missed expectations an applied downward pressure on the Japanese Yen; this favors binary call options in the EURJPY currency pair
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