Today’s Binary Options Trading Strategy:
• Currency Pair: GBP/JPY
• Timeframe: H4 (Hourly Chart)
• Binary Option Trading Recommendation: Seek binary call options on dips below 178.300
• Upside Potential: The upside potential for this binary call option is 480 pips to 183.100
• Downside Potential: The downside potential for this binary call option is 180 pips to 176.500
The GBP/JPY is drifting away from its most recent intra-day low of 176.478 which was reached on March 26th 2015. Preceding this intra-day low, which represents a false breakdown below its horizontal support level, was a corrective phase which emerged from its intra-day high of 183.139 recorded on March 11th 2015. The formation of an ascending support level has guided the GBP/JPY to the upside until it reached an intra-day high of 179.183 on April 7th 2015. This allowed for the formation of a descending resistance level.
Price action is now trading inside of its horizontal support level which is being enforced by its ascending support level and intersected by its descending resistance level. The GBP/JPY is expected to breakout above its descending resistance level and accelerate to the upside. 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 178.300 for a risk/reward ratio of 1.0/2.67.
The GBP/JPY enjoyed a trading environment with reduced volatility during its corrective phase which was further reduced during the drift away from its most recent intra-day low below its horizontal support level. An increase is expected as price action is trading inside of a triangle formation. Sellers are likely to attempt a breakdown below its ascending support level, but the most recent intra-day low is anticipated to remain intact. Buyers are favored to breakout above its descending resistance level and advance back into its horizontal resistance level.
The first resistance level, after a successful breakout above its descending resistance level, awaits the GBP/JPY at its intra-day high of 179.183 which was recorded on April 7th 2015. This level represents the high reached during its most recent drift to the upside. A breakout above this level will take the GBPJPY to its intra-day high of 181.023 which was reached on March 18th 2015. This level marked the high recorded during a price spike. The final resistance level is located at its intra-day high of 183.139 which was reached on March 11th 2015 from where a double top formation may develop and challenge any further advance.
The following economic data out of the United Kingdom is expected to impact the base currency, the British pound, of the GBP/JPY currency pair:
Halifax House Price Index for the month of March:
• Expectations: A monthly increase of 0.1% is expected for March, an annualized increase of 8.5%
• Previous Report’s Data: A monthly contraction of 0.3% was reported in February, an annualized increase of 8.3%
• Impact on the British pound: The expected annualized increase in the Halifax House Price Index may suffice to pressure the British pound to the upside which favors binary call options in the GBP/JPY currency pair
In addition the following economic report out of Japan is expected to impact the quote currency, the Japanese yen, of the GBP/JPY currency pair:
Eco Watchers Survey for the month of March:
• Expectations: A level of 50.5 in the Current Index is expected for the month of March, a level of 53.5 in the Outlook Index
• Previous Report’s Data: A level of 50.1 in the Current Index was reported in the month of February, a level of 53.2 in the Outlook Index
• Impact on the Japanese yen: The anticipated increase in the Current Index as well as the Outlook Index is unlikely to apply upward pressure on the Japanese yen; this favors binary call options in the GBP/JPY currency pair