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Binary Options Analysis By GOptions Dec 11,2012

Discussion in 'Major Currency Crosses' started by ciniasaada, Dec 11, 2012.

  1. ciniasaada

    ciniasaada New Member

    Dec 4, 2012
    Likes Received:

    The main focus in the markets these last days has certainly been economic and political news. But the strange phenomenon being seen is that the markets are barely reacting to any news. As a result, stock markets in the US and in Europe are basically trading “sideways”. But things might change today with the US Federal Reserve beginning their 2 day meeting later today and thereafter, on Wednesday, reporting whether they are making changes to the current monetary policy. Binary options traders need to get ready for a busy news day as markets continue to trade in range bound patterns.

    Many are beginning to speculate on the possibility that the Fed will increase the budget for monthly repurchases of bad bonds from 40 billion. According to Yahoo Finance, this is becoming less likely due to the fact that the jobs market seems almost unaffected by the storm that hit the US in early November.

    This type of news should normally push the US stock markets higher as it is a testament of the economy’s momentum and strength. So if today binary options traders actually see no change to the monetary policy, it should cause markets to be lifted and even the USD could return to its winning ways. But we have more than 24 hours until this all takes shape.

    So today, binary options traders will actually be surprised by a rather quiet news day. The only major event is at 10am GMT, as the German ZEW index is ready to be release and markets expect a figure of -12 as compared to last month’s -15.7. Any reading at or better than the expected reading should at least allow the EUR/USD to maintain its current uptrend. We don’t expect the figure to cause any shockwaves outside the forex market. Binary options traders would do well to watch the markets closely at the time of release seeing as how news trading is much simpler with binary options than with forex or other instruments.

    Binary traders will also likely focus on the major stocks that are most actively traded with binary options like AAPL, and GOOG. Google stock today looks to be building back momentum and testing the day trading resistance seen at 691.74. This is not a strong resistance and as such, binary traders should not try to use it as a point of entry for reversal strategies but rather try to use the level as a strong entry point for Up options on a break. If the market breaks above, expect the stock to head up towards 702.5. A test of this level will allow binary options traders to take Down options on a test. A reversal strategy here should work well, but make sure that the market is first losing momentum and indicators start pointing down. A good way to do this is if volume indicators are showing a drop as the stock reaches the resistance. It is usually a very good sign of weakness.


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