Tip from the Geek – Top 5 Binary Options Trading Tips 02/17-24/2014

Some Markets Moving Higher

The global equity indices moved higher last week in a continuation of a long term trend bounce that began two weeks ago. Among other things, the change of leadership at the FOMC was a catalyst. More precisely, Janet Yellen’s testimony before congress. She presented a calm and composed figure that seemed assured of itself and in command. This is a far cry from Ben Bernanke, who even on his best day had a quiver in his voice that just did not inspire confidence. Yellen’s support of QE and statements concerning the taper were just what the market needed to hear, now we can focus on the actual economy and earnings.

 

Earnings this time around were pretty good in my opinion. There was a lot of top and bottom line expansion as well as a fair numbers of positive earnings surprises. It was the guidance however that stank a little. More than half of the S&P 500 companies issued guidance that was below expectations or provided a weaker than previously reported out look for 2014. If Janet Yellen sparked the bounce from the trend line, it was the 2014 guidance that caused the marekt to correct there. The thing is, 2014 is supposed to be good. The recent round of less-than-expected economic data was expected. Now that we have weathered the dip it is time to start looking forward again.

 

The winter season is always a little weak in terms of sales, jobs and housing (at least in the northern hemisphere). It is cold, it is after the holiday’s and no one is going on vacation. In the spring things always pick up as builders go back to work and summer businesses gear up for the season. This is another reason why I am maintaining my bullish stance. With the market bouncing from the trend line and a seasonal uptick in economic activity on the way I can’t help but think that the long term up trend in the economy and the equity markets is still intact. However, until a break above previous all-time highs there is still resistance that could keep the indices such as the S&P, Dow and Dax range bound until economic growth resumes.

 

 

 

1. S&P 500 4 Day Week

S&P 500

Call/Put = Call

Entry = Below  1835

Expiry = One Week

 

My trading advice

First note, the S&P 500 is/was not open Monday this week due to a banking holiday in the U.S. Not to worry, only the bankers were off, everybody else had to go to work. There is a lot of data this week that could easily move the market. Housing data, TIC Flows, Philly Fed, Leading Indicators and the FOMC minutes among several others. Provided none of the data leads the market to think that the economy is coming to a grinding halt the rally should continue. The S&P may face some resistance along the way but at this time momentum is strong and seems to be increasing.

 

One reason the current rally in the S&P is showing so much strength is because of the nature of the bounce. The index found support and began the rally from the 150 day EMA and was then aided by traders along the long term trend line and the shorter term 30 EMA. It has since moved above potential resistance and is now moving up from there. All this support, coupled with the strong MACD peak and bullish stochastic on my charts I expect the index to at least test resistance at the previous all-time highs around 1850. I am trading calls this with a target entry below 1835 and one week of expiry.  

 

 

 

2. Germany Waiting For U.S. Open

DAX

Call/Put = Call

Entry = Below 9660

Expiry = One Week

 

My trading advice

The DAX is also bouncing from long term support and has momentum on it’s side. At the same time it is also facing some resistance but has some room to move up. Economic data in the EU has been doing a little better than expected, ie the recent GDP figures, and has led to some optimism. Now, it the rest of the world such as China and the US can put up some OK numbers this week the DAX should move higher with the SPX and other major indices. I am trading calls with a target entry below 9660 and one week of expiry.

 

 

 

3. Not the Euro

JPMorgan

Call/Put = Call

Entry = Below $58

Expiry = One Week

 

My trading advice

I’ve decided to cut the euro out of my portfolio for a while cuz I suck at it. There I said it, I suck at trading the euro so I must stop trading it therefore I must trade something else. The banks are well positioned to make money as the economy advances, I like trading the banks so I took a look at JPM. Bank balance sheets are improving all the time and JPM has now put it’s regulatory and other financial issues to rest making it a nice pick for me. There may still be a fine or two for the company but the major part of that is now history. The stock is showing strength at this time and has some room to move higher. It has recently broken a short term resistance in the midst of a long term up trend. Indicators are bullish and on the rise so I am going to trade a call on this asset with a target entry below $58 and one week until expiry.

 

 

 

4. Yen Poised For A Bounce

USD/JPY

Call/Put = Call

Entry = Below 102

Expiration = One Week

 

My trading advice

When I looked at the USD/JPY chart today I saw a strong signal. The pair has been in a correction driven by unmet market expectations and now it looks poised to continue it’s uptrend. It is probably not a coincidence that the charts look the way they do on the cusp of a BOJ meeting. The BOJ is making its next decision as I write this analysis. Price action has confirmed support and the indicators are signaling a buy. The MAC is turning positive at and the stochastic is making the second, stronger confirming signal I like to look for when the market is reversising, finding support or confirming resistance.  I am trading calls on the pair with a target entry below 102 and one week until expiry.

 

 

 

5. Gold Schmold

Gold

Call/Put = Call

Entry = Below $1325

Expiry = One Week

 

My trading advice

I don’t get it but gold is skyrocketing higher. I am expecting it to find resistance at the $1350 area but until then I am going to ride the roller coaster with a call. I am trading a call with a target entry below $1325 with one week until expiy.

 

 

More Tips by the Geek – 02/17-24/2014 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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