Tip from the Geek – Top 5 Binary Options Trading Tips List 3-10/12/2012

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Markets On Tip Toes Awaiting Fiscal Cliff Announcements

The world market are still in flux as mixed data and political issues weigh on traders minds.  Santa Rally or not the markets face a lot of resistance moving forward.  Mainly its the fiscal cliff we have to be worried about. The fiscal cliff is surely going to be fixed but how that fix will come is yet to be seen.  Negotiations last week left the situation unchanged and there is not expected to any new developments this week. Until that happens the US markets are likely to be range bound.


In a broader view, world economic recovery is still questionable.  New data shows that the world is still on shaky ground.  November PMI data was released around the world as today’s trading and news rooms opened up. The data shows that China has regained positive momentum, Europe is still contracting but not as much as last month and that the US manufacturing has slowed down a bit. In my opinion this data shows that world manufacturing is basically unchanged but choppy from region to region.


The story stocks at the beginning of this week were positive. Three more corporations have announced a special dividend and there are more supposedly on the way. This trend will likely help to elevate the US markets in the short term but could result in a big sell off before the end of the year as dividend traders exit these positions. In the tech sector Dell received an upgrade to buy based on an overly pessimistic market view. The Nasdaq was one of the heaviest hit indexes during the October decline and could have some of the biggest gains in December.



1. US Markets Consolidating Above Support 

S&P 500

Call/Put = Call

Entry = below 1420

Expiration = end of the week


My Trading Advice in 50 Words

The markets are real choppy right now. The S&P is recovering from the recent selling and has a lot of resistance in front of it.  Long term direction is cloudy and in the near term fiscal cliff worry could cap the market at the next significant resistance of 1430.  The long term indicators show a bull market that is bouncing from support but one that is weakening and ready for major correction.  In the short term the index is still drifting up and is supported by the short and long term moving averages. Until the cliff is past, and past it will become, I am only going to be trading weekly options on the S&P. There is just too much opportunity for news, technical trading or the economy to derail any potential long term movements.  For now, while the index is above the moving averages I am looking for the index to move up to the next resistance at 1430.



2.Technology Is Always So Shiny At Christmas Time

Nasdaq Composite

Call/Put = Call

Entry = below 3025

Expiration = end of the week



My Trading Advice in 50 Words

The tech sector suffered some of the worst declines over the last two months.  Pessimism over demand for PC’s, sales of smart phones and how the two industries were affecting each other helped to drive the index lower.  Now the first round of upgrades has begun with Dell getting the nod from Goldman Sachs. This upgrade and the others that are surely going to follow will help to add momentum to the index.


This index faces the same resistance and susceptibility to fiscal cliff news as the S&P.  Moving forward there is resistance at 3,100.  At this time I looking for the Nasdaq to consolidate above 3,000 in preparation for a move up to 3,100.  Depending on how quick this move is and the amount of fiscal cliff progress we get it could take the index through 3,100.  If this happens next resistance is at 3,200. 



3. China Drop Could Be In Play

Heng Seng

Call/Put = Put

Entry = above 21,900

Expiration = end of week



My Trading Advice in 50 Words

Even though manufacturing picked up to expansionary levels the Chinese stock markets sold off last night.  The data provided a lift to these stocks early but the pop was met with heavy selling.  The Shanghai Composite fell to near four year lows and the Heng Seng made a very bearish candle signal at resistance.  The Chinese index is making what looks to me like a nice double top and is getting ready to move down.  Even if this is just short term bearishness in this index I see more chance for this index to close the week lower rather than higher.


For the longer term pessimism in Chinese stocks could be at a peak.  The Shang Hai is at four year lows despite the signs of its own economic stability.  I know China has been in decline for a long time but it is still growing at +7% annually.  Not to mention that the Chinese government issued a statement saying that fiscal target would be met if not exceeded. I will be looking for a potential reversal in the Shang Hai, which could help lift the Heng Seng above resistance.  Until then, or any other signs of bullishness, I am bearish on China.



4.Euro Gets Lift 


Call/Put = Call

Entry = below 1.3050

Expiration = end of the week



My Trading Advice in 50 Words

The euro is experiencing a relief based pop driven by the corrective measures being taken throughout the region. Greece finally got its relief package last week, putting it and its debt back on the shelf for another year or so.  Spain has also requested aid. This in itself is a little surprising because of how long Spain stood its ground against the relief.  What was even more surprising was the small amount of coverage it got in the media. Anyway, the pair has moved up past the significant 1.3000 level and looks good to follow through on earlier bullish signals.



5.Easy Japan Still Set To Print Money


Call/Put = Call

Entry = below 82.50

Expiration = end of the month


My Trading Advice in 50 Words

The Japanese yen is consolidating against the dollar.  The recent slide in its value, driven by BOJ easing and expectations of “unlimited” easing after the impending elections should continue based on a technical perspective.  The consolidation could take a week or more, maybe until the elections are finalized, but it will be up again by the end of the month.




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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