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By: Adam Stone
April 14th 2014 5:30am GMT, London UK
 

US markets took a hit again this past Friday and this would ordinarily mean binary options traders would be looking for greener pastures. However, since the release of the Non Farm Payrolls report on the first Friday of this month, binary options traders seem to be back on the down-trend band wagon. For months and month, binary traders swarmed in when indices were on the rise, which was the case for almost all of 2013, but buzzed off once things turned a tad bit rough. Binary options traders exhibited a very odd behavioral pattern that created opportunity. In a sense, the lack of volume on indices during short downward spells in 2013 created an indicative result that led most dealers here at GOptions to think the trend downward was upon us, and it was always correct. Always, that is, until two Fridays ago.

Since then, ever sudden move to the downside has been a land slide and this past Friday was no different. The US stock market again dropped and although less dramatic than Thursday’s tumble, it was deep and powerful nonetheless. The S&P lost 0.95% to 1815 and binary options traders are now positioning themselves for down options on any break of the critical 1800 support level.

The primary culprit for the drop off is the impending earnings season, set to begin in the coming days. The tech stocks were the first to feel the heat as there seem to be fewer believers in the current bubble feel to the market. But this isn’t the whole story. The miserable weather this winter is cause for concern as well with retail outfits expected to show dismal results and profits stuck in 10 feet of snow.

An interesting trend that we may find ourselves witnessing in the coming days is a continued slide in indices but a rise in individual stock prices, primarily in blue chip stocks. Stocks like Intel, IBM, Google and Apple may all find themselves countering the trend in place despite the technical nature of these firms. All of these stocks look to be bettering themselves in the coming weeks with better results and smart acquisitions. For example, IBM has agreed to purchase a relatively small firm by the name of SilverPop. Although not a game changer for the company or the industry, on any level, it is a telling sign that even the most stalwart of industry bellwethers see the need for diversification and risk management. The move into cloud based services further indicates the general trend of blue chip service providers like IBM.

Look for other blue chips to head higher while pure tech, low cap stocks, to head downward in the coming session and possibly right through earnings season.

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Adam Stone
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Adam Stone

As COO of GOptions, my first and foremost goal is to provide traders with the most up to date info from the markets. I have been trading the markets since 2004 and have been involved with stocks, binary options, and forex trading since then. I have had no formal market education and pride myself on a self taught approach to everything related to trading. I try to focus though on both the technical and fundamental aspects related to each trading day and bring forward the most important aspects of risk/reward in the market.
Adam Stone
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