March 18th, 2015 7:38am GMT, London UK
Today’s Binary Options Trading Strategy:
• Currency Pair: NZDUSD
• Timeframe: H4 (Hourly Chart)
• Binary Option Trading Recommendation: Seek binary call options on dips below 0.7450
• Upside Potential: The upside potential for this binary call option is 160 pips to 0.7610
• Downside Potential: The downside potential for this binary call option is 70 pips to 0.7380The NZDUSD is enjoying a bounce higher after reaching its most recent intra-day low of 0.7187 on March 11th 2015. This represented a false breakdown below is horizontal support level and the NZDUSD initially advanced to an intra-day high of 0.7444 which was recorded on March 12th 2015; a move which was quickly reversed to a higher low with an intra-day low of 0.7274 recorded on March 18th 2015. This level is located just beneath its horizontal support level and the NZDUSD caught a powerful advance after yesterday’s press conference by US Federal Reserve Chief Janet Yellen.
Price action is currently being pressured lower by its descending resistance level after yesterday’s surge. The NZDUSD is expected to advance and breakout above its descending resistance level in order to challenge its intra-day high of 0.7610 which was reached on March 4th 2015. Binary options traders can profit from the anticipated advance with binary call options. Today’s binary options trading strategy suggests call options to be placed on dips below 0.7450 for a risk/reward ratio of 1.0/2.29.
Volatility remained contained during the move to the downside and away from its intra-day high of 0.7610, but the false breakdown invited an increase in volatility which is further expected to increase as the NZDUSD is trading inside of a triangle formation which is applying pressure for this currency pair to either breakdown below its ascending support level or to breakout above its descending resistance level. Sellers are expected to prevent a breakout from unfolding and try to pressure this currency pair into a breakdown below its horizontal support level; buyers are anticipated to successfully force a breakout. This favors binary call options in the NZDUSD currency pair.
The NZDUSD will face its first resistance level, after a successful breakout above its descending resistance level, at its intra-day high of 0.7547 which was reached yesterday on March 18th 2015. This level represents the high recorded during yesterday’s spike. This level also represents the bottom of its horizontal resistance level. A breakout above this level will take the NZDUSD to its final resistance level located at its intra-day high of 0.7610 which was recorded on March 4th 2015.
The following economic data out of New Zealand already impacted the base currency, the New Zealand Dollar, of the NZDUSD currency pair:
Gross Domestic Producer for the fourth-quarter of 2014:
• Expectations: A quarterly increase of 0.8% was expected for the fourth-quarter of 2014, an annualized increase of 3.4%
• Previous Report’s Data: A quarterly increase of 0.9% was reported in the third-quarter of 2014, an annualized increase of 3.2%
• Released Data: A quarterly increase of 0.8% was reported for the fourth-quarter of 2014, an annualized increase of 3.5%
• Impact on the New Zealand Dollar: The reported annualized increase in fourth-quarter GDP has lifted the New Zealand Dollar which this favors binary call options in the NZDUSD 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 NZDUSD currency pair:
Philadelphia Federal Reserve Index for the month of March:
• Expectations: A level of 7.0 is expected for the month of March
• Previous Report’s Data: A level of 5.2 was reported for the month of February
• Impact on the US Dollar: The expected reading for the Philadelphia Federal Reserve Index is vulnerable to disappoint and pressure the US Dollar to the downside; this favors binary call options in the NZDUSD currency pair