Tip from the Geek 04/20 – 04/27/2015: Get Ready For The Fed!
Top 5 Weekly Binary Options Trading Signals by the Geek
I know it’s still a week early but I think we all need to get ready for the FOMC meeting next week. The meeting is scheduled for Tuesday and Wednesday and could send the market rocketing. Which direction is a hotly debated question but I am still a bull and looking for a bounce. Why is this meeting so important? Because it is the last meeting before the indicated range in which we can expect the first rate hike. Based on all they have said before the FOMC could do almost anything at this meeting including no changes to policy or statement, changes to statement but not policy and even changes to both. A change to both would be way outside of expectations and not too likely in my opinion. The other two options are very likely I would say but it’s what they say that matters.
Until then there is still quite a lot of tradable news and plenty of time to make some trades. This week is going to be a big one for earnings as it is the first really full week of reports and includes roughly 25% of the S&P 500 stocks. So far trends are above expectations, lets see how they unfold and what the future outlook is. Based on what I have seen and read the outlook is still good with expectations of increased sales, more hiring and rising wages. There is also plenty of geopolitical new to add volatility to trading. Fighting is still raging in Yemen, the Iran nuclear deal, Chinese economic stimulus and many many more.
1. I’m A Trend Watcher
S&P 500
Call/Put = Call
Entry = Below 2090
Expiry = One Week
My Trading Advice
I am most definitely a trend watcher. I watch them all day long and what I am seeing in the SPX is very promising. The index has been in a protracted long term up trend for many years and is now bouncing along a technical trend line in preparation for a break above resistance. Over the past 3 months the index has been winding up into a symmetrical triangle that in my opinion is very bullish. The down ticks have all been on near term outlook and events, poor earnings expectations and FOMC speculation. The upticks are all on economic data, earnings and long term outlook.
This week there isn’t a whole lot of long term economic data but there is still jobless claims and a few key pieces of housing data. What is going to be the big mover of the broad market this week is the earnings. Earnings are coming in better than expected with outlook for growth out to the end of 2016. I am using last weeks move down to the trend line as my entry and placing a call. My target entry is below 2090 with one week until expiry.
2. Oil Prices Are At A Peak
USO/Oil ETF
Call/Put = Put
Entry = Above $19.75
Expiry = One Week
My Trading Advice
Yet another bearish indication for the oil markets has helped to push prices down from their peak last week. The news, Saudi Production was near record highs for yet another month. This means that there is no slow down in production, no diminishing of supplies and is now affecting more countries. Nigeria for one is expected to go bankrupt simply because it can’t sell its oil, there too much and better places to get it. I am trading a put on the USO this week with a target entry above $19.75 and one week until expiry.
3. Gold Steady Ahead Of The Fed
Gold
Call/Put = Call
Entry = Below $1200
Expiry = 3 days
My Trading Advice
Gold is holding steady around the $1200 level while we get ready for the Fed. The dollar and long term expectations are the reason. The dollar is stuck in a range and consolidating while central bank policy and near term news even out prices. I’m bullish on gold long term, and bullish on gold in the near term as well. I’m taking advantage of the trading range between $1190 and $12150 by buying a call this week, with three days to expiry. If prices go over $1215 by then I may buy a call with 3days as well. Longer term positions should wait until after the FOMC meeting.
4. Dollar Rangers Ho!
USD/JPY
Call/Put = Call
Entry = Below 119
Expiry = Three Days
My Trading Advice
The dollar is consolidating and affecting more than just gold. Everything that is dollar related is also in some form of trading range or pattern, including the USD/JPY. This pair is in a 6 month trading range and consolidating around the 30 day moving average. The indicators are in line with support and a move to the top of the range so I am trading a call. This pattern is probably going to be heavily influenced by support/resistance and the upcoming Fed meeting so I am keeping expiry short at 3 days, target entry is below 119.
5. Euro Is Not Immune
EUR/USD
Call/Put = Put
Entry = Above 1.07250
Expiry = Three Days
My Trading Advice
The euro is not immune to dollar influence and has the added baggage of the everlasting, never ending gobstopper that is the Greek bail out. Greece is going to affect near term movements into the future, no end in sight, but it will be FOMC and ECB policies that drive the longer direction. The EUR/USD pair may reach parity but it will have to break support at 1.0500 first. The pair is not in the same dollar consolidation as gold and the yen, with a downside target driven by the 30 day moving average. I am trading a put on this pair, target is above 1.07250 with three days until expiry.
More Tips by the Geek – 04/20-27/2015 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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