February 10th, 2015 5:04am GMT, London UK
Today’s Binary Options Trading Strategy:
• Currency Pair: AUDUSD
• Timeframe: H4 (Hourly Chart)
• Binary Option Trading Recommendation: Seek binary call options on dips below 0.7775
• Upside Potential: The upside potential for this binary call option is 515 pips to 0.8290
• Downside Potential: The downside potential for this binary call option is 150 pips to 0.7625The AUDUSD is trading inside its horizontal support level after a false breakout occurred which was reversed after this currency pair recorded an intra-day low of 0.7626 on February 3rd 2015. The AUDUSD has drifted back inside of its horizontal support level which is being enforced by its ascending support level. This currency pair may trend sideways until enough upside pressure has accumulated for an accelerated move back inside its horizontal resistance level. A breakout above its descending resistance level will have to precede this expected move.
Price action is currently trading back inside its horizontal support level as downward pressure is being deflated. The AUDUSD is anticipated to resume its drift higher until it approaches its descending resistance level from where a breakout is expected. Binary options traders can profit from the likely breakout with binary call options. Today’s binary options trading strategy suggests call options to be placed on dips below 0.7775 for a risk/reward ratio of 1.0/3.43.
Volatility has contracted together with the move in price action to the downside. This move developed after the AUDUSD reached an intra-day high of 0.8295 on January 15th 2015. Volatility further decreased during its drift to the upside, but is expected to increase as price action is now trapped inside a triangle formation. Sellers may attempt to force a breakdown below its enforced support level which is unlikely to materialize. Buyers are expected to drift higher guided by its ascending support level. This favors binary call options in the AUDUSD currency pair.
The AUDUSD will face its first resistance level at its descending resistance level around the 0.7945 mark. This level will be crucial for this currency pair and a breakout above it is expected to take the AUDUSD to its next resistance level at its intra-day high of 0.8025 which was reached on January 28th 2015. The next resistance level is located at its intra-day high of 0.8136 which was recorded on January 22nd 2015. The final resistance level awaits the AUDUSD at its intra-day high of 0.8295 which was reached on January 15th 2015. Further upside above this level is not expected.
The following economic data out of Australia already impacted the base currency, the Australian Dollar, of the AUDUSD currency pair:
Home Loans for the month of December:
• Expectations: An increase of 2.0% was expected for the month of December
• Previous Report’s Data: A contraction of 0.7% was reported for the month of November
• Released Data: An increase of 2.7% was reported for the month of December
• Impact on the Australian Dollar: The reported increase in home loans is likely to be overshadowed by economic data out of the US which favors binary call options in the AUDUSD currency pair
In addition the following economic report out of the United States is expected to impact the quote currency, the US Dollar, of the AUDUSD currency pair:
Monthly Budget Statement for the month of January:
• Expectations: A budget deficit of $19.0 billion is expected for the month of January
• Previous Report’s Data: A budget deficit of $10.3 was reported for the month of December
• Impact on the US Dollar: The expected increase in the budget deficit may suffice to pressure the US Dollar to the downside; this favors binary call options in the AUDUSD currency pair