Today’s Binary Options Trading Strategy:
• Currency Pair: USD/CHF
• Timeframe: H4 (Hourly Chart)
• Binary Option Trading Recommendation: Seek binary put options on rallies above 0.9410
• Downside Potential: The downside potential for this binary put option is 335 pips to 0.9075
• Upside Potential: The upside potential for this binary put option is 140 pips to 0.9540
The USD/CHF has retreated from its most recent intra-day high of 0.9543 which was reached on May 27th 2015. This level represented a false breakout above its horizontal resistance level and the USD/CHF has now completed a breakdown below it. The preceding advance emerged from its intra-day low of 0.9078 which was recorded on May 14th 2015; this level marked a slightly higher low as compared to its previous intra-day low of 0.9072 reached on May 7th 2015. A look at today’s binary options trading charts shows that the USD/CHF is trading inside of a rising wedge formation which suggests further downside.
Price action is currently trading between the ascending support level of its rising wedge formation and its horizontal resistance level. The USD/CHF is expected to breakdown below its ascending support level and accelerate to the downside. Binary options traders can profit from the anticipated breakdown with binary put options. Today’s binary options trading strategy suggests put options to be placed on rallies above 0.9410 for a risk/reward ratio of 1.0/2.39.
Volatility decreased during the advance away from its horizontal support level, but the false breakout above its horizontal resistance level resulted in a spike in volatility which further increased during the retracement and subsequent breakdown. Volatility is likely to increase again as the USD/CHF is trading inside of its rising wedge formation. Buyers may attempt to pressure this currency pair to the upside, but the ascending resistance level is expected to limit any advance. Sellers are favored to successfully breakdown below its ascending support level and enter a corrective phase.
The USD/CHF will face its first support level, after a breakdown below its rising wedge formation, at its intra-day low of 0.9348 which was recorded on May 29th 2015. A breakdown below this level will take the USD/CHF to its intra-day low of 0.9286 reached on May 22nd 2015. The next support level is located at its intra-day high of 0.9255 recorded on May 15th 2015 from where a final breakdown will lead the USD/CHF to its intra-day low of 0.9072 which was reached on May 7th 2015.
The following economic data out of the United States is expected to impact the base currency, the US Dollar, of the USD/CHF currency pair:
Personal Income & Personal Spending for the month of April:
• Expectations: An increase of 0.3% in personal income is expected for the month of April, an increase of 0.2% in personal spending
• Previous Report’s Data: A level of 0.0% in personal income was reported in the month of March, an increase of 0.4% in personal spending
• Impact on the US Dollar: The anticipated slowdown in personal spending is likely to pressure the US Dollar to the downside which favors binary put options in the USD/CHF currency pair
In addition the following economic report out of Switzerland is expected to impact the quote currency, the Swiss Franc, of the USD/CHF currency pair:
SVME Purchasing Managers Index for the month of May:
• Expectations: A level of 47.8 is expected for the month of May
• Previous Report’s Data: A level of 47.9 was reported in the month of April
• Impact on the Swiss Franc: The expected slowdown in the SVME Purchasing Managers Index is may not suffice to apply downward pressure on the Swiss Franc; this favors binary put options in the USD/CHF currency pair
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