Tip from the Geek – Top 5 Binary Options Trading Tips 10/07-14/2013
Easy to understand Binary Options Trading Advices. Try Trading on CommuniTraders!
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Shut Down Lingers, Slams Markets
The lingering U.S. government shut down put a real hurting on the global markets over the weekend. Asian and European indices both lost in the range of 1% with equally large losses indicated in the U.S. futures exchange. The protracted fight has raised increasing speculation over the long term effects and when a possible resolution may come. We have to remember that the U.S. won’t default on its credit and a budget will get passed. This is a short term problem and one that will pass soon. For now, the major U.S. indices are still trending up and supported by increasingly good economic data. However, we must also remember that there hasn’t been any data for three days now and there won’t be any new data, except for some provided by private organizations, until the government goes back to work.
One of the big fears is that U.S. growth may be in danger due to the shut down. For now, the economic trends are up, oil and gas prices are lower and we’re heading into the holiday shopping season. This week is also the beginning of earnings season again. The shut down has overshadowed that event. Tomorrow kicks off with Alcoa. The aluminum producer is expected to report earnings slightly lower than last quarter, due mostly to lower aluminum prices. The big banks are also on tap for this week. Friday we get reports from Wells Fargo and JP Morgan. Earnings are not expected to grow in this sector either, the important information will be contained in the guidance and forward looking statements.
1. S&P Drops Back To Trend
SPX
Call/Put = Call
Entry = Below $1680
Expiration = One Month
My Trading Advice
The long term trend in the S&P is still up. The weakness in futures trading Sunday night is a little worrisome but only brings the index down to it’s trend line and support zone. I think the drop in early futures trading was more a lack of buying than an increase in selling. On the daily charts bearish momentum is weak and stochastic is reaching oversold levels at this time. Both of these indicators are currently coincident with a trending market reaching support.
The shut down is a concern but likely not to affect the markets long term unless we actually do enter default (highly unlikely). The economic trends and earnings are what is going to carry the markets are so far there is no sign of impending market reversal. However, the shut down/budget battle will probably cause some near term volatility so I am looking to trade longer term one month positions. I am bullish on the SPX long term and trading calls with a one month expiry and a target entry below $1680.
2. Don’t Count Germany Out
DAX
Call/Put = Call
Entry = Below 8,500
Expiration = One Month
My Trading Advice
The DAX got hit this past weekend as well. Monday saw the German index down by nearly 1% but it is also still above support and the long term trend. Near term noise has brought this index down to a potentially great entry point. Long term economic trends are positive here as well, with improvements in the U.S., China and Japan all helping to support growth. In order to avoid near term fluctuation I am targeting a one month expiry here as well. I am entering calls with a target entry below 8,500 and one month until expiration.
3. Spinning Gold
Gold
Call/Put = Put
Entry = Above $1315
Expiration = One Month
My Trading Advice
Gold is hovering just above the $1300 level and forming a series of spinning tops. At this level the metal is above a support and below a resistance, still trending down. I would expect gold, in more ordinary times, to be up much more than it is with how weak the dollar is. This is only one of the red flags that have popped up on my radar. Once the shut down is over and we can move past the budget battle craziness the dollar will probably get a boost and help send gold back under $1300. I am trading a put on Gold with a target entry above $1315 and one month until expiration.
4. Triangle Still In Play
USD/JPY
Call/Put = Call
Entry = Below 97
Expiration = One Month
My Trading Advice
The yen got a boost this week as the dollar tanked. The shut down has near term fears at a peak and investors fleeing the dollar. This has brought the USD/JPY back down within the previously broken triangle formation. At this time bearish momentum is weak and the pair is oversold. Abe-nomics, QE, Shut down and BOJ policy are all at odds. I expect this pair to get a boost once the shut down is over but it may remain contained below a longer term resistance until the next BOJ stimulus announcement or the tapering begins. I am trading a call with a target entry below 97 with one month until expiry.
5. Dark Clouds Over The Euro
EUR/USD
Call/Put = Put
Entry = Above 1.3550
Expiation = One Month
My Trading Advice
The euro got a boost versus the dollar as well. The pair hit a long term high last week on shut down and debt ceiling fears. However, this week the pair has formed a Dark Cloud Cover that comes as the pair reaches long term resistance on a major divergence. I am bearish on this pair, trading a put with a target entry above 1.3550 and one month until expiry.
More Tips by the Geek – 9/23-30/2013 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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