Gold Binary Call Option: March 5, 2015
GOption | Mar 05, 2015 02:19AM ET
Today’s Binary Options Trading Strategy:
• Commodity: Gold
• Timeframe: H4 (Hourly Chart)
• Binary Option Trading Recommendation: Seek binary call options on dips below 1,205.50
• Upside Potential: The upside potential for this binary call option is 4,025 pips to 1,245.75
• Downside Potential: The downside potential for this binary call option is 1,510 pips to 1,190.40
Gold has entered a corrective phase after reaching an intra-day high of 1,245.75 on February 10th 2015 which was the result of a drift to the upside from its intra-day low of 1,228.22 recorded on February 6th 2015. The intra-day high marks the top end of its horizontal resistance zone. Gold reached an intra-day low of 1,190.39 on February 24th 2015 which marked a false breakdown below its horizontal support level from where it reversed back inside of it. The formation of an ascending support level additionally enforces the horizontal support level and Gold started to trend sideways.
Price action is now trading inside of its horizontal support level where its ascending support level started to exercise additional upward pressure. Gold is anticipated to drift higher until it will break out above its descending resistance level for an accelerated advance. Binary options traders can benefit from the expected breakout with binary call options. Today’s binary options trading strategy suggests call options to be placed on dips below 1,205.50 for a risk/reward ratio of 1.0/2.67.
Gold witnessed a decrease in volatility which accompanied the corrective phase away from its intra-day high of 1,245.75, but an increase in volatility is expected as Gold is trapped inside a narrow triangle formation. Sellers may attempt to force a breakdown below its ascending support level which is not expected to materialize below its most recent intra-day low. Buyers are favored to take the ascending support level which enforces the horizontal support level in order to successfully breakout above its descending resistance level and accelerate to the upside until it reaches its horizontal resistance level.
The first resistance level awaits Gold at its descending resistance level around the 1,210.80 mark from where a breakout will take this commodity to its intra-day high of 1,223.18 which was reached on March 2nd 2015. This level represents the high reached during a previous drift to the upside and where the descending resistance level exercised downward pressure. A breakout above this level will take Gold to its intra-day high of 1,236.59 which was reached on February 16th 2015. The final resistance level is located at its intra-day high of 1,245.75 which was recorded on February 10th 2015 from where a double top formation may emerge.
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The following economic data out of Australia already impacted Gold:
Australian Trade Balance for the month of January:
• Expectations: A trade deficit of A$925 million was expected for the month of January
• Previous Report’s Data: A trade deficit of A$503 million was reported in the month of December
• Released Data: A trade deficit of A$980 million was reported for the month of January
• Impact on Gold: The bigger than expected trade deficit out of Australia has caused money to flow into Gold which favors binary call options in this commodity
In addition the following economic report out of Canada is expected to impact Gold:
Ivey Purchasing Managers Index for the month of February:
• Expectations: A level of 48.5 is expected for the month of February
• Previous Report’s Data: A level of 45.4 was reported in the month of January
• Impact on Gold: The anticipated continuation of the contraction in the Ivey PMI is likely to apply upward pressure on Gold; this favors binary call options in Gold
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