October 28th 2014 5:30am GMT, London UK
Today’s Binary Options Trading Strategy:
• Currency Pair: EURAUD
• Timeframe: H4 (Hourly Chart)
• Binary Option Trading Recommendation: Seek binary call options on dips below 1.4415
• Upside Potential: The upside potential for this binary call option is 285 pips to 1.4700
• Downside Potential: The downside potential for this binary call option is 100 pips to 1.4315
The EURAUD has been exposed to a corrective phase which has taken this currency pair from its intra-day high of 1.4705 which it reached on October 16th 2014 back down to is intra-day low of 1.4362 which was reached on October 22nd 2014. This intra-day low marked a higher low than its previous intra-day low of 1.4313 which it reached on October 7th 2014 and allowed for the formation of an ascending support level. The EURAUD has managed to bounce higher off of this ascending support level before reversing back down to it.
Price action has now bounced higher once again and is expected to resume its move higher from current levels until its tests its horizontal resistance level. The EURAUD may reverse into its ascending support level once more before launching its extended move higher. Binary options traders can take advantage from the expected move higher with binary call options. Today’s binary options trading strategy suggests call options to be placed on dips below 1.4415 for a risk/reward ratio of 1.0/2.85.
Volatility could experience a sharp increase as the EURAUD is trading at a crucial support level. Sellers may attempt to extend the downward momentum and challenge its intra-day low of 1.4313 which would lead to the formation of a double bottom. The ascending support level has merged with its horizontal support level and created a very strong double support area which favors buyers to reverse price action higher and take the EURAUD back into its horizontal resistance level.
The first resistance level awaits the expected move higher in the EURAUD at its intra-day high of 1.4513 which it reached on October 24th 2014. This intra-day high was the result of the first bounce higher off of its ascending support level. A breakout above this level will take the EURAUD to its intra-day high of 1.4600 which it reached on October 21st 2014. The final resistance level is located at its intra-day high of 1.4705 which it reached on October 16th 2014 and from where a double top formation is possible.
The following economic data out of the Eurozone is expected to impact the base currency, the Euro, of the EURAUD currency pair:
German Import Price Index for the month of September:
• Expectations: A monthly contraction of 0.1%, an annualized contraction of 1.9%
• Previous Report’s Data: A monthly contraction of 0.1% was reported in August, an annualized contraction of 1.9%
• Impact on the Euro: The stable reading in the German import price index, Germany is the largest economy in the Eurozone, should suffice to lift the Euro which favors binary call options in the EURAUD currency pair
In addition the following economic data out of Australia already impacted the quote currency, the Australian Dollar, of the EURAUD currency pair:
ANZ Roy Morgan Consumer Confidence Index for the week ending October 26th 2014:
• Expectations: A weekly increase to 112.1 was expected
• Previous Report’s Data: A reading of 111.6 was reported in the previous week
• Reported Data: The ANZ Roy Morgan Consumer Confidence Index came in at 114.6
• Impact on the Australian Dollar: The better than expected reading in the Australian consumer confidence index failed to lift Australian Dollar higher; this favors binary call options in the EURAUD currency pair