November 28th 2014 5:28am GMT, London UK
Today’s Binary Options Trading Strategy:
• Currency Pair: USDCAD
• Timeframe: H4 (Hourly Chart)
• Binary Option Trading Recommendation: Seek binary call options on dips below 1.1330
• Upside Potential: The upside potential for this binary call option is 130 pips to 1.1460
• Downside Potential: The downside potential for this binary call option is 65 pips to 1.1265
The USDCAD has experienced a strong push to the upside during yesterday’s trading session despite slightly better than expected economic data out of Canada. The move was technical in nature as price action accelerated to the upside after touching its ascending support level. Prior to the sharp advance the USDCAD moved to the downside from an intra-day high of 1.1466 which it reached on November 5th 2014 until it recorded an intra-day low of 1.1191 on November 21st 2014 from where a drift higher emerged.
Price action is now trading just above its descending resistance level after a successful breakout during yesterday’s trading session. The USDCAD is expected to test its descending resistance level turned support before a move higher may unfold. Binary options traders can take advantage from 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 1.1330 for a risk/reward ratio of 1.0/2.00.
Yesterday’s breakout above its triangle formation, comprised by its descending resistance level which guided the USDCAD to the downside and its ascending support level which was formed as a result of the drift higher from its intra-day low, was accompanied by a spike in volatility. Sellers are expected to try and reverse the spike higher, but are likely to be limited to the intersection between its descending resistance level and ascending support level. Buyers are anticipated to take the strength of the breakout and accelerate it to the upside. This favors binary call options in the USDCAD currency pair.
The USDCAD will face its first resistance test at its intra-day high of 1.1369 which was reached on November 20th 2014. This level marks the last time the USDCAD touched its descending resistance level from where this currency pair was pushed into its most resent intra-day low. A breakout above this level will take the USDCAD to its intra-day high of 1.1427 which was reached on November 4th 2014. The final resistance level is located at its intra-day high of 1.1466 which was reached on November 5th 2014 from where a double top formation may hinder a further advance.
The following economic data out of the United States is expected to impact the base currency, the US Dollar, of the USDCAD currency pair:
NAPM-Milwaukee Manufacturing Index for the month of November:
• Expectations: A reading of 64.00 is expected for the month of November
• Previous Report’s Data: A reading of 65.61 was reported for the month of October
• Impact on the US Dollar: The anticipated slowdown in the NAPM-Milwaukee Index is likely to be overshadowed by economic data out of Canada which favors binary call options in the USDCAD currency pair
In addition the following economic report out of Canada is expected to impact the quote currency, the Canadian Dollar, of the USDCAD currency pair:
Gross Domestic Product for the third-quarter of 2014:
• Expectations: An annualized expansion of 2.1% is expected for the third-quarter
• Previous Report’s Data: An annualized expansion of 3.1% was reported in the second-quarter
• Impact on the Canadian Dollar: The expected slowdown in the annualized GDP growth for the third-quarter is likely to pressure the Canadian Dollar to the downside which favors binary call options in the USDCAD currency pair