May 1st, 2015 5:20am GMT, London UK
Today’s Binary Options Trading Strategy:
• Commodity: Gold
• Timeframe: H4 (Hourly Chart)
• Binary Option Trading Recommendation: Seek binary call options on dips below 1,185.00
• Upside Potential: The upside potential for this binary call option is 2,600 pips to 1,211.00
• Downside Potential: The downside potential for this binary call option is 985 pips to 1,175.15
Gold has dropped sharply over the past few trading session which took this commodity from its most recent intra-day high of 1,215.01 recorded on April 28th 2015 to its intra-day low of 1,177.04 reached yesterday on April 30th 2015. Economic data released caused the outflow of capital from Gold into other assets which assisted the corrective phase. A descending resistance level formed due to the lower high as compared to its previous intra-day high of 1,224.18 which was reached on April 6th 2015 while an ascending support level formed as a result of the higher low as compared to its previous intra-day low of 1,175.15 which was recorded on April 24th 2015.
Price action is now trading inside of its horizontal support level after bouncing off of its ascending support level which is enforcing its horizontal support level. Gold is expected to drift higher until enough upward momentum is present for an accelerated advance into its descending resistance level. Binary options can take advantage of the anticipated move to the upside with binary call options. Today’s binary options trading strategy suggests call options to be placed on dips below 1,185.00 for a risk/reward ratio of 1.0/2.64.
Volatility increased during the move to the downside which spanned only three trading sessions and a further increase in volatility is anticipated as Gold trades at an enforced support level. Sellers are likely to pressure this commodity to the downside in order to extend the corrective phase, but this potential move is unlikely to materialize below its horizontal support level. Buyers are expected to take the current bounce off of its ascending support level in order to reverse part of its move lower and challenge its descending resistance level. This favors binary call options in Gold.
Gold will face its first resistance level at its intra-day high of 1,198.04 which was recorded on April 23rd 2015. This level is near the psychologically important 1,200.00 level and represents the high reached during a previous advance prior to reaching its intra-day low of 1,175.15 on April 24th 2015 from where the ascending support level originates. A breakout above this level will take Gold to its final resistance level which is located at its descending resistance level around the 1,211.00 mark. More upside potential is likely to be limited from this level.
The following economic data out of Australia already impacted Gold:
AiG Performance of Manufacturing Index for the month of April:
• Expectations: A level of 47.1 was expected for the month of April
• Previous Report’s Data: A level of 46.3 was reported in the month of March
• Released Data: A level of 48.0 was reported in the month of April
• Impact on Gold: The better than expected level out of the Australian AiG Performance of Manufacturing Index failed to apply downward pressure on this commodity which favors binary call options in Gold
In addition the following economic report out of the United Kingdom is expected to impact Gold:
Markit Manufacturing PMI for the month of April:
• Expectations: A level of 54.6 is expected for the month of April
• Previous Report’s Data: A level of 54.4 was reported in the month of March
• Impact on Gold: The anticipated increase in the Markit Manufacturing PMI may not suffice to pressure Gold to the downside; this favors binary call options in this commodity