Tip from the Geek – Top 5 Binary Options Trading Tips 04/28-05/05/2014
April Tug Of War
April has been a real tug of war in the markets. Economic data, earnings, central banks and the Russian incursion into the Ukraine have kept markets moving. Last week’s big gains were wiped out on Friday when tensions escalated, then were recovered early Monday on the back of M&A and other positive news. This week will probably be the same. The economic calendar is heavy with central banks meetings, macro data and earnings. The BOJ and the FOMC are both meeting this week, the BOJ as I write this, the FOMC starts tomorrow. Both banks having the power to shift markets such as the USD/JPY and gold. Later in the week the data starts rolling in with the ADP report on Wednesday and the NFP on Friday, along with a handful of other important reports. Trends are up and signs are good that the data will be positive.
Earnings are still on tap. The season is more than half over and more than half of S&P 500 companies have reported. So far more than 75% of those have met or beaten the expectations with more than 50% of them beating. This week we’ll start to see some reports from the energy sector as well as the retailers. Through it all the thing to keep your eye though will be Vladimir Putin, Russian and the Ukraine. While I don’t think it likely that widespread violence will break out it is possible. And regardless of that any moves by Putin have the power to spook the market and send traders running for cover.
1. Snap Back
S&P 500
Call/Put = Call
Entry = Below 1875
Expiry = End of the week
My Trading Advice
The SPX made a nice snap back rally from last weeks closing prices on Monday morning. The index is being supported by improving economic trends, better than expected earnings and a flurry of M&A activity. Early headlines Monday morning included an unsolicited offer from Pfizer to by Astrazenaca for a reported $100 billion. The offer was rejected as it was the first time but that didn’t matter, the fact that one company wanted to spend the money was enough for the markets.
Last weeks drop took the index down to test support along the 30 day moving average. This support line is coincident with the long term trend line and the previous all-time high levels. Indicators are bullish in both the short and long term although divergences are forming that need to be watched. The only resistance ahead is the current all-time high. So long as data and earnings trends remain positive, the FOMC doesn’t totally shock the market and Putin doesn’t screw everything up the markets will keep pushing higher. I am trading a call this week with a target entry below 1875 and one week until expiry.
2. Putin Hurts EU Worst
DAX
Call/Put = Call
Entry = Below 9450
Expiration = One Week
My Trading Advice
Putin definitely sucks, that goes without saying. His moves into the Ukraine are not cool and are depressing EU indices. The good news is that the world is getting better everyday and that includes the EU. Germany is the strongest portion of the EU and therefor my top choice when entering that market. The index is sitting on support with bullish indicators in the short term. Longer term the index could be range bound but looks good to move up to the top of the range in the near term. I am trading a call on the DAX with one week until expiry and a target entry below 9450.
3. Gold, Gold, Gold
Gold
Call/Put = Put
Entry = Above $1295
Expiry = One Week
My Trading Advice
Today was another one of those days that the market moved in my direction as I was making my trades. Unfortunately I did not get into my gold trade quite when I wanted to. I would have preferred to enter this trade above the $1300 level, and it may be possible still to do so, but like I said, as I was about to place my trade the price of gold dropped below that support level. The good news is that I believe gold will be moving lower very soon. The FOMC and the BOJ both have the power to move this metal and together to move it a lot. In terms of the FOMC their outlook and forecast on the economy, in particular on interest rates, will be the catalyst. This week I am trading a put on gold with a target entry above $1295 and one week until expiry.
4. BOJ No More QE….
USD/JPY
Call/Put = Call
Entry = Below 102.40
Expiration = One week
My Trading Advice
The BOJ is meeting as I write this article. The bank is not expected to do anything except maintain current rates and policies and I don’t see any reason to think differently. While more QE may be needed it is not likely the BOJ will increase it until data tells them to. The tax hike begun this month may push them to it but there just isn’t any data yet to lead the way. The USD/JPY has been trading along the bottom of a 3-4 month trading range but began to move up Monday morning. Indicators are bullish and suggest that the pair will move toward the top of the range. I am trading a call on the USD/JPY with a target entry below 102.4 and one week of expiry.
5. Shiny Shiny Apples
Apple
Call/Put = Call
Entry = Below $585
Expiration = One week
My Trading Advice
Apple is on the move. The company finally got its mojo back and now investors are flooding in. Earnings are good, outlook is good and the share repurchase plan is good. Monday morning the stock made a long white candle from a long term resistance turned support level. I am trading a call on the stock this week with a target entry below $585 and one week until expiry.
More Tips by the Geek – 04/28-05/05/2014 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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