Today’s Binary Options Trading Strategy:
• Commodity: Gold
• Timeframe: H4 (Hourly Chart)
• Binary Option Trading Recommendation: Seek binary call options on dips below 1,162.00
• Upside Potential: The upside potential for this binary call option is 4,370 pips to 1,205.70
• Downside Potential: The downside potential for this binary call option is 1,925 pips to 1,142.75
Gold witnessed an outflow of capital over the past three trading weeks and this commodity moved lower inside of its bearish price channel as a result of it. The descending support level originated from its intra-day high of 1,190.67 which was reached on June 15th 2015 while the descending resistance level can trace its origin to its intra-day high of 1,205.70 recorded on June 18th 2015. A new horizontal support level is now being intersected by its bearish price channel and pushed Gold from its downtrend into a sideways trend which has created some interesting trading opportunities in this precious metal.
Price action is currently trading inside of its horizontal support level from where the move lower was paused as this commodity started to trade sideways. Gold is expected to breakout above its bearish price channel and accelerate 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 1,162.00 for a risk/reward ratio of 1.0/2.27.
Gold was exposed to a contraction in volatility which resulted from the contraction of price action inside of its bearish price channel. Volatility is expected to increase as this commodity is trading near the descending resistance level of its bearish price channel from where a breakout is anticipated to result in a momentum shift. Binary options traders who are not trading commodities should take a look at commodity options trading in order to diversify their trading accounts. Sellers may attempt to force a breakdown below its horizontal support level in order to keep the downtrend intact while buyers are likely to succeed in a breakout which will clear the path to the upside.
The first resistance level after a successful breakout above its bearish chart pattern awaits Gold at its intra-day high of 1,174.89 which was reached on July 6th 2015 from where this commodity traded into a false breakdown below its horizontal support level. A breakout will take Gold to its intra-day high of 1,190.67 recorded on June 15th 2015. This level marks the origin of its descending support level. The final resistance level is located at its intra-day high of 1,205.70 which was reached on June 18th 2015 from where a double top formation may emerge.
The following economic data out of Australia already impacted Gold:
Australian Home Loans for the month of May:
• Expectations: A contraction of 3.0% was expected for the month of May
• Previous Report’s Data: An increase of 0.7% was reported in the month of April
• Released Data: A contraction of 6.1% was reported for the month of May
• Impact on Gold: The reported bigger-than-expected contraction in Australian home loans has pressured Gold to the upside; this favors binary call options in this commodity
In addition the following economic report out of Canada is expected to impact Gold:
Canadian Employment Report for the month of June:
• Expectations: 10,000 job losses are expected for the month of June, an unemployment rate of 6.9%
• Previous Report’s Data: The addition of 58,900 jobs was reported in the month of May, an unemployment rate of 6.8%
• Impact on Gold: The expected contraction in the Canadian labor market is likely to apply upward pressure on this commodity which favors binary call options in Gold
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