EUR/GBP Binary Call Option: January 30 2015
GOption | Jan 30, 2015 04:08AM ET
Today’s Binary Options Trading Strategy:
• Currency Pair: EUR/GBP
• Timeframe: H4 (Hourly Chart)
• Binary Option Trading Recommendation: Seek binary call options on dips below 0.7510
• Upside Potential: The upside potential for this binary call option is 365 pips to 0.7875
• Downside Potential: The downside potential for this binary call option is 110 pips to 0.7400
The EUR/GBP is currently in the process of stabilizing and confirming its new horizontal support level. This currency pair corrected after it recorded its intra-day high of 0.7875 on January 6th 2015. Economic worries and the anticipation of the announced bond buying program out of the European Central Bank have contributed to weakness in the Euro and the EUR/GBP reached an intra-day low of 0.7404 on January 26th 2015 from where it started to drift higher. More upside is expected from the EUR/GBP.
Price action is currently trading just outside of its horizontal support level and any dip inside of it should be taken as a good entry opportunity. The EUR/GBP is anticipated to take the accumulated upward momentum in order to extend its recent gains. Binary options traders can benefit from the expected move to the upside with binary call options. Today’s binary options trading strategy suggests call options to be placed on dips below 0.7510 for a risk/reward ratio of 1.0/3.32.
The EUR/GBP was exposed to a decrease in volatility as the corrective phase moved this currency pair from its horizontal resistance level back down to its horizontal support level, but volatility is likely to increase as this currency pair has established a new support level. Sellers are anticipated to step in and prevent the EUR/GBP to advance in order to force more downside. Buyers are expected to take the current drift higher together with its horizontal support level as a solid platform to extend its recent gains and challenge its most recent intra-day high of 0.7875.
The first resistance level awaits the EUR/GBP at its intra-day low of 0.7595 which was reached on January 16th 2015. This marked the low before this currency pair drifted higher. A breakout above this level will take the EUR/GBP to its intra-day high of 0.7714 which was reached on January 21st 2015. This level marked the high of its previous drift higher before the EUR/GBP accelerated to the downside. The next resistance level is located at its intra-day low of 0.7784 which was recorded on January 9th 2015 from where a final breakout will take the EUR/GBP to its last resistance level at its intra-day high of 0.7875 which was reached on January 6th 2015.
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The following economic data out of the Eurozone is expected to impact the base currency, the Euro, of the EUR/GBP currency pair:
German Retail Sales for the month of December:
• Expectations: A monthly increase of 0.3% is expected for December, an annualized increase of 3.6%
• Previous Report’s Data: A monthly increase of 0.5% was reported in November, an annualized contraction of 0.8%
• Impact on the Euro: The anticipated annualized increase in retail sales out of German is likely to pressure the Euro to the upside which favors binary call options in the EUR/GBP currency pair
In addition the following economic report out of the United Kingdom is expected to impact the quote currency, the British Pound, of the EUR/GBP currency pair:
Net Consumer Credit for the month of December:
• Expectations: A level of £1.2 billion is expected for the month of December
• Previous Report’s Data: A level of £1.3 billion was reported for the month of November
• Impact on the British Pound: The expected slowdown in consumer credit is anticipated to apply downward pressure on the British Pound; this favors binary call options in the EUR/GBP currency pair
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