November 3rd 2014 5:15am GMT, London UKToday’s Binary Options Trading Strategy:
Today’s Binary Options Trading Strategy:
• Currency Pair: AUDUSD
• Timeframe: H4 (Hourly Chart)
• Binary Option Trading Recommendation: Seek binary call options on dips below 0.8740
• Upside Potential: The upside potential for this binary call option is 170 pips to 0.8910
• Downside Potential: The downside potential for this binary call option is 90 pips to 0.8650
The AUDUSD has enjoyed an overall drift higher over the past three trading weeks after this currency pair reached an intra-day low of 0.8651 on October 13th 2014. Economic data out of Australia has lifted the Australian Dollar at a time where economic data out of the US failed to impress and underperformed. The AUDUSD did reach an intra-day high of 0.8911 on October 29th 2014 before a sharp reversal took this currency pair back below its ascending support level and into its horizontal support level.
Price action has now stabilized inside its horizontal support level from where the AUDUSD is expected to move back up into is ascending support level and attempt a breakout in order to test its most recent intra-day high. Binary options traders can profit from the expected move higher and subsequent breakout with binary call options. Today’s binary options trading strategy suggests call options to be placed on dips below 0.8740 for a risk/reward ratio of 1.0/1.89.
Volatility is expected to experience a sharp increase as sellers are likely to force a breakdown below the horizontal support level in order to extend the move lower and challenge the intra-day low from where the momentum change occurred. Buyers are expected to use the current support level in order to accumulate sufficient upward momentum for a sustained move higher as more forces support a move to the upside as there are for a breakdown. This favors binary call options in the AUDUSD currency pair.
The first resistance level awaits the AUDUSD at its ascending support level around 0.8815 from where a breakout will take this currency pair to its intra-day high of 0.8853 which was reached on October 30th 2014. This level has previously halted a move higher and pushed this currency pair into its ascending support level. A successful breakout above this level will take the AUDUSD to its intra-day high of 0.8911 which was reached on October 29th 2014 from where a double top formation may emerge and revers price action once again.
The following economic data out of Australia already impacted the base currency, the Australian Dollar, of the AUDUSD currency pair:
Building Approvals for the month of September:
• Expectations: A monthly contraction of 1.0% was expected for September, an annualized contraction of 0.9%
• Previous Report’s Data: A monthly increase of 3.4% was reported in August, an annualized increase of 16.0%
• Released Data: A monthly contraction of 11.0% was reported for September, an annualized contraction of 13.4%
• Impact on the Australian Dollar: The sharp contraction in building approvals plunged the Australian Dollar into a solid horizontal support level from where it is expected to move higher 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:
Institute of Supply Management Manufacturing Index for the month of October:
• Expectations: A reading of 56.4 is expected for the month of October
• Previous Report’s Data: A reading of 56.6 was reported for the month of September
• Impact on the US Dollar: The anticipated contraction in the ISM Manufacturing Index for October is expected to apply downward pressure on the US Dollar; this favors binary call options in the AUDUSD currency pair