Tip from the Geek – Top 5 Binary Options Trading Tips 04/07-14/2014

Get Ready For Earnings

Earnings season starts tomorrow, that’s Tuesday of this week for those of you who may not be reading this today. Alcoa is expected to report earnings that are in line with the previous quarter. Not a great expectation, no pun intended, but it won’t be the past quarter’s earnings season that is important. It will be the outlook for the 2nd quarter and the rest of the year. We already know for the most part that the calendar first quarter of 2014 was pretty lame. We also already know that there is expectation for a rebound in the 2nd quarter, it’s the strength of the rebound that will determine long term market direction. On a whole, this week is pretty light for earnings reports, only about 2 dozen or so. However, of the names on the list there are some heavy hitting players such as JPM, Well Fargo and Constellation Brands.

 

Data is also  light this week. Of course there are the usual weekly reports of mortgage index, jobless claims and oil supply but macro data is limited to FOMC minutes, Wholesale Inventories, PPI and Michigan Sentiment. The expectations at this time are for all of these data points to be better than last time around. Similarly there is very little data coming from Asia or Europe as well. The week started with the release of Industrial Production numbers for Germany and Spain, both were better than expected. As for the markets, the week opened very weak which was expected after last Friday’s sell-off in the U.S. In the end though the long term economic trends are still up so my recommendation is still to buy on the dips.

 

 

 

1. Whoa There SPX!

S&P 500

Call/Put = Call

Entry = Below 1860

Expiration = One Month

 

My Trading Advice

The sell off in U.S. equities last Friday caught me by surprise to say the least. The NFP data was good I thought, and with the revisions to it and to the ADP number make the spring jobs season look better than before.  At this time the sell off is not worrisome but if the market doesn’t find support during earnings then we could be in for more correction. For now the indicators are still showing support for the markets at the current levels and with economic trends the way they are I am still bullish.

 

There could be some more volatility over the next week or two so making a shorter term recommendation is hard. The long term charts are consistent with support as well so I am switching to monthly calls this week in order to give the market time to move past this period. By the time it expires we will have gotten through 75% of the reports and gotten another round of monthly macro data. I am trading a call with a target entry below 1860 and one month until expiry.

 

 

 

2. Banking On Earnings

JPM

Call/Put = Call

Entry = Below $60

Expiration = One Week

 

My Trading Advice

JP Morgan is set to report earnings before the bell on Friday. The bank is expected to report earnings slightly lower than last quarter but that may be impacted by the volume of money that the bank has had to pay in fines, settlements and judgements over the past few months. As I said before, it will be the outlook for the rest of the year that drives stock prices and I expect to see the banks keep on improving along with the economy. I am trading a call on JPM with a target entry below $60 and one week until expiry.

 

 

 

3. Oil Holding Steady

Oil ETF

Call/Put = Call

Entry = Below $36.50

Expiration = One Week

 

Oil prices are holding steady above $101. Global demand expectations, an expected deal to reopen Libyan oil ports, Ukraine/Russia and improving economic data all having an affect on oil prices. Looking at the USO, the Crude Oil ETF, the price has stabilized around the $36 level with support indicated just below. I am trading a call on the USO with a target entry below $36.50 and one week until expiration.

 

 

 

4. Gold Falling From Resistance

Gold

Call/Put = Put

Entry = Above $1300

Expiration = One week

 

My Trading Advice

Gold prices made a mild rebound last week and broke back above the $1300 resistance line. This week started with gold prices falling back and recrossing beneath resistance. Indicators are bearish and with no reason to be bullish on gold I remain bearish. I am trading a put on gold with a target entry above $1300 with one week of expiration. The FOMC minutes on Tuesday may be the biggest mover of this trade as they will likely discuss the taper, interest rate hikes and when they would begin.

 

 

 

5. BOJ Meeting Again

USD/JPY

Call/Put = Call

Entry = Below 103.25

Expiration = One Week

 

My Trading Advice

The BOJ is meeting again and once again there is some expectation for an increase in QE. The bank is faced with combating long term deflation, stagnant growth and now a new tax hike aimed at paying for many of the new reforms instituted by PM Shinzo Abe. The usd/jpy pair made a nice move up over the past week in anticipation and is now sitting on support. I am bullish on this pair and BOJ, trading a call with a target entry below 103.25 and one week until expiry.

 

 

More Tips by the Geek – 04/07-14/2014 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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