Today’s Binary Options Trading Strategy:
• Currency Pair: GBP/AUD
• Timeframe: H4 (Hourly Chart)
• Binary Option Trading Recommendation: Seek binary call options on dips below 1.9650
• Upside Potential: The upside potential for this binary call option is 370 pips to 2.0020
• Downside Potential: The downside potential for this binary call option is 80 pips to 1.9570
The GBP/AUD has found support inside of its horizontal support level after gradually moving to the downside and away from its most recent intra-day high of 2.0028 which was reached on February 12th 2015. A descending resistance level, which formed amid a series of lower highs, has limited each reversal from its horizontal support level, but the formation of an ascending support level may provide the support needed for a breakout. The ascending support level originated from its intra-day low of 1.9423 which was recorded on February 10th 2015 and is located below its horizontal support level.
Price action is currently trading inside its horizontal support level from where downward momentum is fading away and this currency pair is stabilizing. The GBP/AUD is expected to breakout above its descending resistance level guided by its ascending support level. Binary options traders can benefit from the anticipated breakout with binary call options. Today’s binary options trading strategy suggests call options to be placed on dips below 1.9650 for a risk/reward ratio of 1.0/4.63.
Volatility decreased during the drift away from its intra-day high of 2.0028, but a sharp spike in volatility is expected as the GBP/AUD is trapped inside a triangle formation. This will increase pressure for this currency pair to either breakdown below its ascending support level or breakout above its descending resistance level. Sellers may attempt to force a breakdown which is not expected to materialize below its intra-day low of 1.9571 recorded on February 20th 2015. Buyers are expected to use the ascending support level as well as the horizontal support level in order to successfully breakout above its descending resistance level and accelerate back inside of its next horizontal resistance level.
The GBP/AUD will face its first resistance level at its descending resistance level around the 1.9745 mark. A breakout above this key resistance level will take the GBP/AUD to its intra-day high of 1.9850 which was reached on March 2nd 2015 from where a further breakout will clear the path to its intra-day high of 1.9951 recorded on February 24th 2015. This level marks the bottom of its horizontal resistance level. The final resistance level is located at its intra-day high of 2.0028 which was reached on February 12th 2015.
The following economic data out of the United Kingdom is expected to impact the base currency, the British pound, of the GBP/AUD currency pair:
Markit/CIPS Services PMI for the month of February:
• Expectations: A reading of 57.5 is expected for the month of February
• Previous Report’s Data: A reading of 57.2 was reported in the month of January
• Impact on the British Pound: The anticipated increase in the Markit/CIPS Services PMI may suffice to pressure the British pound
to the upside which favors binary call options in the GBP/AUD currency pair
In addition the following economic report out of Australia already impacted the quote currency, the Australian dollar, of the GBP/AUD currency pair:
Gross Domestic Product for the fourth-quarter of 2014:
• Expectations: A quarterly increase of 0.6% was expected for the fourth-quarter of 2014, an annualized increase of 2.5%
• Previous Report’s Data: A quarterly increase of 0.4% was reported in the third-quarter of 2014, an annualized increase of 2.7%
• Released Data: A quarterly increase of 0.5% was reported for the fourth-quarter of 2014, an annualized increase of 2.5%
• Impact on the Australian dollar: The reported annualized slowdown in fourth-quarter GDP has applied downward pressure on the Australian dollar; this favors binary call options in the GBP/AUD currency pair