On Friday, July 24th 2015 the Commodity Futures Trading Commission (CFTC) released its weekly report labeled ‘Commitments of Traders’. This report covered the trading week ending July 21st 2015. The Euro saw a spike in gross long positions (65,700) as well as gross short positions (178,700). The British Pound was exposed to a surge in gross long positions (35,100) while gross short positions spiked even more than that (56,600). The Japanese Yen witnessed plenty of trading actions of its own with gross long positions on the rise (50,900) while gross short positions surged (113,200).
The biggest change reported in the CFTC report was evident in S&P 500 futures where gross long positions skyrocketed (356,800) and so did gross short positions (447,300). Binary option traders should seek to add this equity index to their trading account in favor of options stock trading as this will give a broader exposure to the market. The S&P 500 is probably the most liquid asset traders can choose from which is also echoed by the ‘Commitments of Traders’ report.
The last market moving economic report released last Friday came, as expected, out of the United States which reported on new home sales for the month of June. Economists expected an increase of 0.3% to 548,000 new homes, but the released data showed a surprise plunge of 6.8% to 482,000 new homes. Adding to the deterioration in the new home market was a downward revision for May which now shows a contraction of 1.1% to 517,000 new homes.
Today’s Binary Option Trading Recommendations Overview:
• EUR/GBP – Binary Put Option
• USD/JPY – Binary Call Option
• EUR/CHF – Binary Put Option
• Gold – Binary Call Option
• S&P 500 – Binary Call Option
Currency Pairs on today’s Radar Screen:
EUR/GBP – The EUR/GBP has started to drift to the downside after recording its intra-day high of 0.7102 on July 23rd 2015. This resulted in the formation of a descending resistance level which has increased downward pressure on this currency pair. The 50 Day Moving Average (DMA) continues to trade above the 200 DMA. The Accelerator Oscillator (AC) contracted together with price action as the Relative Strength Index (RSI) broke down from extreme overbought territory and is trading in overbought conditions.
Today’s Binary Options Trading Strategy: Put Option
Price action is now trading inside of its horizontal resistance level which is being enforced by its descending resistance level. The EUR/GBP is anticipated to drop into a corrective phase from current levels. Binary option traders are advised to seek binary put options in the EUR/GBP currency pair on rallies above 0.7075 on the H1 Hourly Chart. The downside potential for this binary put option is 135 pips to 0.6940 while the upside potential is 25 pips to 0.7100. This results in a risk/reward ratio of 5.40.
USD/JPY – The USD/JPY is trying to stabilize inside of its horizontal support level from where a double bottom chart pattern is possible. The 50 DMA has crossed below the 200 DMA, but both moving averages are trading in close tandem to each other and are likely to experience more crosses. The AC has confirmed to current move lower while the RSI is trading in oversold territory and has formed a positive divergence.
Today’s Binary Options Trading Strategy: Call Option
Price action is currently trading inside of its horizontal support level after bouncing higher from its intra-day low of 123.488 which was recorded earlier today on July 27th 2015. The USD/JPY is expected to drift into its descending resistance level from where a breakout is favored. Binary option traders are advised to seek binary call options in the USD/JPY currency pair on dips below 123.600 on the H1 Hourly Chart. The upside potential for this binary call option is 85 pips to 124.450 while the downside potential is 30 pips to 123.300. This results in a risk/reward ratio of 2.83.
EUR/CHF – The EUR/CHF enjoyed a strong advance which emerged from its intra-day low of 1.0400 reached on July 20th 2015, but upward momentum has decreased near current levels. The 50 DMA/200 DMA bullish crossover lent support to the move higher. The AC already broke down which suggests a potential price action reversal. The RSI has formed a negative divergence which further indicates the end of the current advance and is also trading in overbought territory after a short excursion into extreme conditions.
Today’s Binary Options Trading Strategy: Put Option
Price action is now trading inside of its newly formed horizontal resistance level and is testing the validity of it. The EUR/CHF is anticipated to breakdown below its horizontal resistance level and move back down into its horizontal support level. Binary option traders are advised to seek binary put options in the EUR/CHF currency pair on rallies above 1.0560 on the H1 Hourly Chart. The downside potential for this binary put option is 160 pips to 1.0400 while the upside potential is 40 pips to 1.0600. This results in a risk/reward ratio of 4.00.
Today’s Commodity Trade
Gold – Gold recovered from its most recent intra-day low of 1,076.85 which was recorded on July 24th 2015. The 50 DMA started to flatten out with a bias to the upside while the 200 DMA continues to move to the downside. The AC indicates a strong increase in upward momentum which accompanied the price action recovery and RSI accelerated into overbought territory from where it is likely to break into extreme conditions.
Today’s Binary Options Trading Strategy: Call Option
Price action is currently trading above of its 50 DMA which resulted in a change of momentum. Gold is expected to continue its recovery and drift into its 200 DMA from where more upside is likely. Binary option traders are advised to seek binary call options in Gold on dips below 1,100.00 on the H1 Hourly Chart. The upside potential for this binary call option is 4,400 pips to 1,144.00 while the downside potential is 2,300 pips to 1,077.00. This results in a risk/reward ratio of 1.91.
Today’s Equity Index Recommendation
S&P 500 – The S&P 500 was faced with a collapse in price action during the previous trading day on Friday, July 24th 2015. This 50 DMA has crossed below its 200 DMA which has increased downward pressure on this equity index. The AC has confirmed the corrective phase, but managed to rebound in late in the session while the RSI is now trading in oversold territory after breaking out from extreme conditions. Instead of options stock trading, binary option traders are recommended to trade the S&P 500 equity index.
Today’s Binary Options Trading Strategy: Call Option
Price action is now trading inside of its horizontal support level which resulted in a decrease in downward momentum. The S&P 500 is anticipated to enter a price action reversal from current levels. Binary option traders are advised to seek binary call options in the S&P 500 equity index on dips below 2,085.00 on the H1 Hourly Chart. The upside potential for this binary call option is 4,775 pips to 2,132.75 while the downside potential is 2,500 pips to 2,060.00. This results in a risk/reward ratio of 1.91.
Key Fundamental Data:
Japan – The Corporate Service Price Index posted an annualized increase of 0.4% in June. Expectations called for an increase of 0.6% which would have matched the 0.6% increase reported in the month of May.
China – Industrial profits in China unexpectedly contracted by 0.3% in June year-over-year. This followed a 0.6% increase in May.
Eurozone – The German Import Price Index is expected to contract by 0.3% in June month-over-month and by 1.3% year-over-year. This would follow the 0.2% contraction which was reported in May month-over-month and 0.8% year-over-year.
Eurozone – The German IFO Business Climate Index for July is expected to decrease by 0.2 points to 107.2 from June’s 107.4. The German IFO Current Assessment Index is also expected to decrease by 0.2 point to 112.9 in July from June’s 113.1 and so is the German IFO Expectations Index down to 101.8 in July from June’s 102.0.
United Kingdom – CBI Trends Total Orders for July are expected to come in at -6 while CBI Trends Selling Prices are expected to come in at -8. This would follow the -7 which was reported in June for bot indicators respectively. CBI Business Optimism is expected to decrease to 1 in July from June’s level of 3.
United States – Durable goods orders are expected to increase by 3.2% in June after posting a contraction of 1.8% in May, but durable goods orders excluding transportation are only expected to increase by 0.5% in June which would match the 0.5% increase reported in May.
United States – The Dallas Federal Reserve Manufacturing Activity Index for July is expected to come in at -3.0 which would follow the -7 reported in June.
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