Tip from the Geek – Top 5 Binary Options Trading Tips List 1/14-21/2013

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Is It Time To Run With The Bulls?

Last week brought us the start of earnings season and took the markets to new five year highs.  A string of positive global economic data and net positive cash inflows into US equity funds helped to legitimize the bullish sentiment.  Trading activity was also positive, the news and the expectations for a good earnings season led traders to buy right into the close of trading on Friday.  This week is expiration week for standard and index options and this could bring some volatility to the markets.

 

Alcoa began earnings season last week with a mediocre report at best.  The stock has since gone into a crazy and volatile chart pattern.  The banks are up to bat now and so far they have been hitting them in the park. Amex reported earnings early on Thursday, stealing a little thunder from Wells Fargo who was scheduled to report Friday morning.  Both reports were good but neither hit a home run; Amex beat estimates by a narrow margin and cited some tough conditions in their report.  Wells Fargo reported record full year and quarterly earnings but only met expectations. This week a minimum of 38 banks will be reporting earnings and could easily change the course of trading.

 

Along with earnings there is also the debt ceiling debate to consider but at the moment it is also conjecture and not really driving trades. What’s really important this week is the economic data.  Including earnings there are another 8-10 important US data releases. Early in the week retail sales is followed by PPI and manufacturing data. Mid week housing starts, building permits and the Philly Fed survey. Ending the week is the regular reporting of jobless claims and the monthly report of Michigan Sentiment. The week is going to be full and there is a lot of things happening that could make it move.

 

 

1. S&P 500 Breaking Out To New Highs

S&P 500

Call/Put = Call

Entry = below 1465

Expiration = end of the month

 

My Trading Advice

The S&P is breaking out to new highs but faces a turbulent week. An early week pullback would not be out of place and could provide the entry I am looking for. I fully expect some profit taking due to expiration week for standard equity, index and forex options. Two things that could amplify this move are earnings and economic data. The banks are dominating the earnings front this week but they represent less than 10% of companies reporting this week. Regardless of which report you read be it a bank or otherwise it will be the guidance and forward looking statements that makes or breaks the earnings rally.  And the data, the data needs to remain solidly neutral to positive.

 

 

The US markets opened quiet and cautious this week but above the new support line of 1465. The short and longer term bull trends are positive and because of this a call is the only way for me to trade. However, because the bulk of companies reporting are doing so later in the week there is a good chance for an early week pullback to that support. I am buying calls with monthly expirations with a target entry of <1465.

 

 

2. Yen Trade Is Still “Game On!”

USD/JPY

Call/Put = Call

Entry = below 89

Expiration = monthly

 

My Trading Advice

The USD/JPY trade is still on despite its near vertical run up to the +89 level. The target price of 90 yen per USD set by Shinzo Abe is what is driving this trade and why I call this as close to a sure thing as you can get in trading (but it really isn’t, trading always involves risk). Based on this target the trade still has nearly a whole point to go and momentum will likely take it beyond 90 to some extent.

 

As for this week. The yen’s slide to this level is still a great place to take profits. Cautious traders, or just traders in general, may seek to take some profits off the table here.  Expiration week will surely bring some volatility and could also drive the price lower, at least on an intra-day basis. There really isn’t enough meat on the bone here for a standard forex trader but there is plenty for binary guys. I am a little cautious getting here but still think it is a good trade. I will be looking for a pull back this week with a target entry for monthly expiration below 89.

 

 

3. Euro Continues To Strengthen Against The Dollar

Eur/USD

Call/Put = Call

Entry = below 1.300

Expiration = end of the month

 

My Trading Advice

The euro continues to strengthen against the dollar and the technicals are bullish. The debt ceiling debate issue is driving at least one trade right now and this is it.  The impending possibility of an increased US debt load and the risk of credit downgrades is serious business for the dollar and could weaken it further.  I am cautious because of expiration week and am looking for an entry below 1.300 for a monthly call on the euro.

 

 

4.JP Morgan Is A Bank To Bank On

JPMorgan

Call/Put = Call

Entry = below $46

Expiration = weekly

 

My Trading Advice

The banks are set to rock, at least according to expectations and technical indicators. Earnings should be OK this quarter, they won’t be stellar but they will show improvements.  Out of the big banks JP Morgan is the shining star for me.  Even though they suffered huge losses over the Whale the bank is solid and Jamie Dimon is a great leader.  I am trading weekly calls ahead of earnings with an entry below $46.

 

 

5. Another Bite Out Of Apple, Or Maybe One Out Of Me

Apple

Call/Put= call

Entry = under $510

Expiration = end of the month

 

My Trading Advice

Apple tanked Monday morning after news they cut orders for iPhone parts by 50%.  This was taken as a sign of decreased demand and bad news. I say, we already knew this, it has been on everyone’s mind for the last quarter or more and this is just knee-jerk trading. It is also a great time to get in at long term support with a speculative call with a monthly expiration.

 

 

 

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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 AnyOption Binary Options Trading Platform.

 

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