Today’s Binary Options Trading Strategy:
• Commodity: Silver
• Timeframe: H4 (Hourly Chart)
• Binary Option Trading Recommendation: Seek binary call options on dips below 15.95
• Upside Potential: The upside potential for this binary call option is 180 pips to 17.75
• Downside Potential: The downside potential for this binary call option is 65 pips to 15.30
Silver is stabilizing inside of its horizontal support level and entered a sideways trend after recording an intra-day low of 15.815 on June 11th 2015. This commodity arrived at this level after a strong move to the downside emerged from its intra-day high of 17.772 which was reached on May 18th 2015. An ascending support level, which originated from its intra-day low of 15.286 recorded on March 11th 2015, is additionally lending support to Silver. The risk remains to the upside and traders are advised to make use of commodity option trading in order to diversify their portfolio.
Price action is currently trading inside of its horizontal support level which is likely to be strong enough to prevent further downside. Silver is expected to trend sideways until enough upward momentum for a breakout has been accumulated. Binary options traders can profit from the anticipated move to the upside with binary call options. Today’s binary options trading strategy suggests call options to be placed on dips below 15.95 for a risk/reward ratio of 1.0/2.77.
Silver experienced a contraction in volatility which accompanied the move away from its intra-day high of 17.772 and decreased further as price action entered a sideways trend inside of its horizontal support level. Binary option traders planning to engage into commodity option trading need to account for an increase in volatility as Silver is trading at a crucial support level. Sellers are likely to attempt a breakdown below its horizontal support level which is not expected to materialize. Buyers are anticipated to force a price action reversal which will take this commodity back to its horizontal resistance level. This favors binary call options in Silver.
This commodity will face its first resistance level at its descending resistance level around the 16.300 mark from where a breakout will clear the path to its intra-day low of 16.545 which was reached on May 28th 2015. The next resistance level awaits Silver at its intra-day high of 17.179 recorded on June 1st 2015. This level marks the last time its descending resistance level reversed an advance. A breakout above this level will take Silver to its intra-day high of 17.398 which was reached on May 19th 2015 and marks the low end of its horizontal resistance level. The final resistance level is located at its intra-day high of 17.772 recorded on May 18th 2015.
The following economic data out of Switzerland is expected to impact Silver:
Producer & Import Prices for the month of May:
• Expectations: A monthly increase of 0.1% is expected for May, an annualized contraction of 5.1%
• Previous Report’s Data: A monthly contraction of 2.1% was reported in April, an annualized contraction of 5.2%
• Impact on Silver: The anticipated deflationary reading out of Swiss Producer & Import Prices is likely to apply upward pressure on Silver which favors binary call options in this commodity
In addition the following economic report out of the United States is expected to impact Silver:
Empire State Manufacturing Index for the month of June:
• Expectations: A level of 6.00 is expected for the month of June
• Previous Report’s Data: A level of 3.09 was reported in the month of May
• Impact on Silver: The expected reading out of the Empire State Manufacturing Index may disappoint and pressure this commodity to the upside; this favors binary call options in Silver.
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