Tip from the Geek 03/02 – 09/2015: Are We On The Brink Of Global Expansion?
Top 5 Weekly Binary Options Trading Signals by the Geek
The Peoples Bank of China reduced interest rates last night. This move is not too surprising and marks the latest round of global easing that could be setting us up for a round of international expansion. Think about it, the US enacted QE years ago and is now benefiting from an expanding economy with underlying momentum. Since then the rest of the world has languished to the point that the rest of the worlds central banks got on board. The first to really commit was Japan and the BOJ with Abenomics, next was the ECB with its recent decision to increase the balance sheet and buy sovereign debt and now China has lowered its interest rates. If all three of these economies see similar results as the US then we really are on the verge of global expansion and so far, there are glimmering signs of improvements in Japan and the EU. Whether or not they last and turn into real trends is yet to be seen but the move in China could be a boost to both economies.
This is going to be a big week for the US markets. There are hundreds, if not over a thousand, mid and small-cap names reporting, and most of the rest of the S&P 500. Earnings trends are much better than previously expected and should continue to deliver good results this week. Economic data is of even bigger concern for the market this week. There are over two dozen macro economic data points being released this week including housing, manufacturing, auto sales, and jobs. The most important day of the whole week will be Friday when they release the February NFP report. I think that the trends will remain intact and I think the market agrees with me, at least for now. Monday morning price action has so far been quite bullish and sent the NASDAQ up and over 5,000.
1. Market Surges To New Highs
S&P 500
Call/Put = Call
Entry = Below 2,105
Expiration = One Week
My Trading Advice
The market is breaking out to new highs on the cusp of a massive week of economic data. This is a good sign for the bulls as it means that the market will most likely ignore any negative bits and focus on the positive. So long as forward expectation remain positive I think there is little chance of an economic driven market reversal. The data is going to be scrutinized for signs of improvements from January to February; some of the data is going to be from January and some from February so be sure to take that into account. Some will be from the fourth quarter of last year so I wouldn’t even worry about that.
Price action is bullish over the short term but has pulled back to support recently. The indicators are also bullish, but have weakened along with the index as it tested support. Support is the previous all time high and potentially strong. It may be tested during the week but I expect to see strong labor data among other data points and support to hold. I think this support level is going to be the spring board from which the market rockets higher. I am trading a call with a target entry below 2,105 and one week until expiration.
2. Pressure Building In Oil
USO/Oil ETF
Call/Put = Put
Entry = Above $18.00
Expiration = One Week
My Trading Advice
I am not bullish on oil, not at all. The trend is down and price action has been falling, along the down trend line. At the same time inventory and storage levels remain high as well as production. Now Libya is back on line, again, and adding another million barrels per day to the market. I am trading a put on the USO while it is along the trend line with a target entry above $18 and one week until expiry.
3. Gold Floats Higher
Gold
Call/Put = Call
Entry = Below $1215
Expiration = One Week
My Trading Advice
Gold prices got a boost from the PBC move to lower rates. Not only did the move help to firm global currencies it also sparked physical buying in China and elsewhere in Asia. $1200 is my new line-in-the-sand to watch and target for long term support. This move is being aided by rising expectations of interest hikes from the FOMC, which will be egged on by this weeks data. The metal is moving higher, bouncing off of this support level and I am bullish along with it. I am trading a call on gold with a target entry below $1215 and one week until expiry.
4. Dollar Marching Higher
USD/JPY
Call/Put = Call
Entry = Below 119.75
Expiry = One Week
My Trading Advice
The dollar is marching higher. It has no choice in the face of global QE and the brink of US tightening, not to mention strong US economic tailwinds. These trends are pushing the USD/JPY up against resistance with bullish indicators and a high likelihood of breaking out of the three month range and moving up to test the long term highs set last fall. I am bullish on this pair and buying a call. My target entry is below 119.75 with one week until expiry.
5. The DAX Attacks, Bear Style
The DAX
Call/Put = Put
Entry = Above 11380
Expiry = One week
My Trading Advice
I don’t usually play puts, especially during an uptrend, but the DAX is too inviting. The index has made a nice move on global events, supported by the ECB recent action to increase bond purchases, and is extended. Also, based on my recently begun study of Elliot Waves it looks like this index is poised for a pullback, if not a 3-5% correction. I am not overly bearish, but bearish enough to play a short term put. My target entry is above 11,380 with one week until expiry.
More Tips by the Geek – 03/02 – 09/2015 Trading Tips On Forum.
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That’s it for this week; Michael will be here next week with fresh trading tips. Meanwhile, we will be testing Michael’s tips to see what kind of an “expert” he really is. All trading assets and expiry times featured in Michael’s trading tips are based on CommuniTraders Binary Options Trading Platform.
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