Today’s Binary Options Trading Strategy:
• Currency Pair: USDJPY
• Timeframe: H4 (Hourly Chart)
• Binary Option Trading Recommendation: Seek binary call options on dips below 119.300
• Upside Potential: The upside potential for this binary call option is 120 pips to 120.500
• Downside Potential: The downside potential for this binary call option is 80 pips to 118.500
The USDJPY has retreated from its horizontal resistance level after a set of lower highs has resulted in the formation of a descending resistance level which applied downward pressure on this currency pair. The first intra-day high of 120.503 was reached on May 5th 2015 and followed an advance from its intra-day low of 118.493 which was recorded on April 30th 2015. A move to the downside took the USDJPY to its intra-day low of 119.053 on May 7th 2015 from where this currency pair advanced into a lower high with an intra-day high of 120.274 on May 12th 2015.
Price action is now trading back inside of its horizontal support level from where a continuation of its corrective phase is highly unlikely. The USDJPY is anticipated bounce off of its horizontal support level and revers its corrective phase. Binary options traders can profit from the expected advance with binary call options. Today’s binary options trading strategy suggests call options to be placed on dips below 119.300 for a risk/reward ratio of 1.0/1.50.
The USDJPY witnessed a spike in volatility during yesterday’s trading session as a result of weaker than expected economic data out of the United States. Volatility is likely to remain at an elevated level as buyers and sellers are now confronting each other at a key horizontal support level. Sellers are anticipated to attempt an extension of the corrective phase which is not expected to violate the origin of its ascending support level which is located at its intra-day low of 118.493. Buyers are favored to stabilize and force a reversal which will take this currency pair back into its horizontal resistance level.
The first resistance level awaits the USDJPY at its descending resistance level around the 119.950 mark. This represents the biggest resistance level for the USDJPY between its horizontal support level and its horizontal resistance level. A breakout will take this currency pair to its intra-day high of 120.274 which was reached on May 12th 2015. This level marks the low end of its horizontal resistance level. The final resistance level is located at its intra-day high of 120.503 which was recorded on May 5th 2015.
The following economic data out of the United States is expected to impact the base currency, the US Dollar, of the USDJPY currency pair:
Initial Jobless Claims & Continuing Claims for the week of May 9th 2015 & May 2nd 2015:
• Expectations: Initial jobless claims at 273,000 for the week ending May 9th 2015, continuing claims at 2,233,000 for the week ending May 2nd 2015
• Previous Report’s Data: Initial jobless claims at 265,000 for the week ending May 2nd 2015, continuing claims at 2,228,000 for the week ending April 25th 2015
• Impact on the US Dollar: The expected level in initial jobless claims as well as continuing claims may suffice to lift the US Dollar which favors binary call options in the USDJPY currency pair
In addition the following economic report out of Japan is expected to impact the quote currency, the Japanese Yen, of the USDJPY currency pair:
Annualized Machine Tool Orders for the month of April:
• Expectations: An annualized increase of 9.8% is expected for the month of April
• Previous Report’s Data: An annualized increase of 14.9% was reported in the month of March
• Impact on the Japanese Yen: The anticipated slowdown in machine tool orders is likely to pressure the Japanese Yen to the downside; this favors binary call options in the USDJPY currency pair
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