Tip from the Geek 06/08–15/2015: Correction, The Market May Move Lower

Top 5 Weekly Binary Options Trading Signals by the Geek

There could be a correction on the way. Not because the market is reversing, but because there isn’t a whole lot to help support prices this week, and there is a whole lot to weight them down. Looking at the indices, and specifically the S&P 500, there is a growing chance the market could move as much as 10% lower. The transports have already made a correction, and could be the signal the rest of the market is going to follow. Over the long term I am still quite bullish, the economy of the world is recovering. It may be hard to see it now but just wait until later this year and you will know what I mean. All this near term fear and expectations of weak first half of the year will be replaced with euphoria as the summer shows expansion and we move into the fall shopping seasons.

 

Other markets have entered correction territory as well, namely the German DAX. It is now down more than 10% from its peak and another sign that the global market has gotten ahead of itself and may correct to the longer term trend. This is kind of a light week for data, but we still have plenty of things going on. PPI on Friday may be the biggest mover of the week because it will undoubtedly affect Fed speculation, the dollar, gold, oil and everything connected to those three assets. Not to mention that Greece debt BS is still on the table, fighting is erupting all-over the middle east and the next FOMC meeting is less than two weeks away.

 

 

 

1. Broader Market Looking Bearish

S&P 500

Call/Put = Put

Entry = Above 2095

Expiry = 3 days

 

My Trading Advice

The S&P 500 is looking more and more bearish in the near term. The index is being weighed down by weak first quarter, weak first half, data that is slow to rebound, global woe and poor expectations for 2nd quarter earnings. This week does not appear to have a lot of events to support the market, we’re light on data and light on earnings with an FOMC meeting in less than 10 days so I am less and less confident in near term uptrend.

 

The indicators support this view. Momentum has shifted to the downside and is gaining in strength. Momentum is not yet strong so the depth of the move is very questionable. Stochastic is also moving lower, in both the near and short terms, and not yet oversold in either so there is still some room for downward movement. I am bearish, this week, so trading a put. I am still bullish longer term, and unsure of how deep this correction may be so keeping expiry short, only three days. My target entry is above 2095.

 

 

 

2. Who Burst The Bubble

USO/Oil ETF

Call/Put = Put

Entry = Above $19.90

Expiry = One Week

 

My Trading Advice

OPEC performed as expected, they held steady on production and made no moves to support prices. The battle between them and the US shale producers rages on and at the same time production/supply remain high, demand is low. Prices have fallen from resistance, for WTI, at $60 and are moving lower with strengthening bearish indicators. I am trading a put, target entry is above $19.90 with one week until expiry.

 

 

 

3. Another Golden Opportunity

Gold

Call/Put = Call

Entry = Below $1175

Expiry = One Week

 

My Trading Advice

Gold prices are offering up another golden opportunity. Gold is sitting on support, just above $1170, with an expectation for producer level inflation to appear later this week. Inflation is gold positive as it is used as a hedge against the dollar. Last month, PPI was weak and gold topped, moving down to where it is now. This month PPI is expected to reverse last month’s decline and more so should provide support if not lift for this asset. I am trading a call on gold with one week until expiry and a target entry below $1175.

 

 

 

4. Yen To Strengthen

USD/JPY

Call/Put = Put

Entry = Above 125

Expiry = 3 Days

 

My Trading Advice

There is going to be some volatility in the currency world this week. Not only is there some important US data on Friday, PPI, the FOMC meeting is next week and there are data from other countries as well. In terms of the yen it looks good to gain strength versus the dollar, why, because Japanese GDP was revised higher and the USD/JPY pair is technically weak. The current peak is diverging from both momentum and stochastic indicating that the recent push above 125 is a whipsaw. I am trading a put on this pair, but with only a three day expiry due to upcoming events, with a target entry above 125.

 

 

 

5. Euro Parity

EUR/USD

Call/Put = Call

Entry = Below 1.1200

Expiry = 3 Days

 

My Trading Advice

Euro parity with the dollar is a theory that relies on a strengthening dollar. It may still happen but I don’t think this is going to be the week. The pair is currently range bound and moving higher with strong indicators so I am trading a call. I am keeping my expiry short, 3 days because of expected news later this week, with a target entry below 1.1200.

 

 

More Tips by the Geek – 06/08-15/2015 Trading Tips On Forum.

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That’s it for this week; Michael will be here next week with fresh trading tips. Meanwhile, we will be testing Michael’s tips to see what kind of an “expert” he really is. All trading assets and expiry times featured in Michael’s trading tips are based on CommuniTraders Binary Options Trading Platform.

 

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