November 7th 2014 6:18am GMT, London UKToday’s Binary Options Trading Strategy:
Today’s Binary Options Trading Strategy:
• Currency Pair: EURCHF
• Timeframe: H4 (Hourly Chart)
• Binary Option Trading Recommendation: Seek binary call options on dips below 1.2045
• Upside Potential: The upside potential for this binary call option is 45 pips to 1.2090
• Downside Potential: The downside potential for this binary call option is 20 pips to 1.2025
The EURCHF has experienced a temporary increase in selling pressure after the European Central Bank President Mario Draghi held a press conference which was preceded by the interest rate announcement where rates were left unchanged as expected. The EURCHF has been in a downward trend after reaching an intra-day high of 1.2092 on October 13th 2014 and has gradually moved lower. Yesterday’s trading session dropped this currency pair to an intra-day low of 1.2030 from where it managed to bounce higher.
Price action is now carving out a new horizontal support level from where the EURCHF is expected to drift higher in order to challenge its descending resistance level which has previously halted an advance. Binary options traders can profit from the anticipated drift upward with binary call options. Today’s binary options trading strategy suggests call options to be placed on dips below 1.2045 for a risk/reward ratio of 1.0/2.25.
Volatility is expected to surge as the EURCHF trades between its horizontal support level and its descending resistance level. Sellers may try to use the previous downward momentum as a catalyst in order to force a breakdown with the help of pressures from the descending resistance level. Buyers are expected to take the current horizontal support level and amass sufficient upward momentum in order to breakout above its descending resistance level which would open the way for a greater move to the upside. This favors binary call options in the EURCHF currency pair.
The EURCHF will face its first resistance test, after a successful breakout above its descending resistance level, at its intra-day high of 1.2057 which was reached yesterday on November 6th 2014. A breakout above this level will take this currency pair to its intra-day high of 1.2069 which was reached on October 31st 2014. This resistance level marks the final resistance level between the EURCHF and its intra-day high of 1.2092 which was reached on October 13th 2014 and from where a double top formation could develop.
The following economic data out of the Eurozone is expected to impact the base currency, the Euro, of the EURCHF currency pair:
German Industrial Production for the month of September:
• Expectations: A monthly increase of 2.0%, an annualized contraction of 0.6%
• Previous Report’s Data: A monthly contraction of 4.0% was reported in August, an annualized contraction of 5.8%
• Impact on the Euro: The expected monthly increase in German industrial production is expected to lift the Euro from depressed levels; this favors binary call options in the EURCHF currency pair
In addition the following economic report out of Switzerland is expected to impact the quote currency, the Swiss Franc, of the EURCHF currency pair:
Unemployment Rate for the month of October:
• Expectations: An unemployment rate of 3.1% is expected for the month of October
• Previous Report’s Data: An unemployment rate of 3.0% was reported for the month of September
• Impact on the Swiss Franc: The anticipated increase in the unemployment rate could exercise downward pressure on the Swiss Franc which favors binary call options in the EURCHF currency pair