The Geek Is Here! . . .Start Earnings, Data And Central Banks
Top 5 Weekly Binary Options Trading Signals by the Geek – Tip from the Geek 01/13 – 20/2015
The market got off to a mixed start this week despite a wave of economic momentum that is sweeping the US. What is the cause? Along with the rapid decline in oil prices, which are weighing heavily on the oil sector and the market in general, earnings and an upcoming round of central bank activity has the market a little nervous. On the earnings front this is the first week of the recognized season. It will begin on Monday with Alcoa’s release after the bell and continue on with reports from heavily watched transportation companies and the banking sector. Traders just can’t figure out what to expect, adding to the earnings conundrum are the upward and downward revisions to guidance as well as upgrades and downgrades from sell side analysts.
The week ahead is packed full of economic data as well. This should all be in line with trends and point to continued growth in the US. How much growth will be important. If the data suggests that things are slowing a down turn in stocks could follow. On tap are regional manufacturing reports including Michigan Sentiment, Philly Fed and Empire State reports as well as Long Term Tic Flows, Inflationary data in the form of CPI and PPI, Retail Sales, JOLTs labor openings, Industrial Production and Capacity Utilization. All on top of the Feds Beige Book which is due to be released on Wednesday. The Beige Book is their read on the economy and outlook for 2015, setting us up for major central bank action over the rest of the month. The final shadow hanging over the markets head this week is central bank activity. This week is the beige book, next week is the ECB and BOJ and the next week is the FOMC. The ECB and BOJ are likely to add QE, the FOMC likely to increase hawkishness in their stance.
1. S&P Is Trending Higher
SPX
Call/Put = Call
Entry = Below 2040
Expiration = One Week
My Trading Advice
The S&P 500 is trending higher, but faced with many obstacles. This week is full of action and could easily move the market on any given day. The thing to remember is that each of these items, on an individual basis is just noise, it is the sum total of all that happens this that will indicate whether the trend continues or if it is time to change. Change may mean reversal, but it also may mean ranging, which is a possibility now. It’s hard to say where the market is going to go from day to day but by the end of the week I think we will see some more positive sign of longer term direction.
The index is trending higher with economic tailwind at its back. Last week it made an impressive bounce from the long term trend line and is currently consolidating. Plunging oil prices are the blame for Friday and Monday selling but will only add to bullishness as the price driven rotation out of energy runs its course. The indicators remain in line with the trend with the possibility of a pullback to the 2000 level. I am trading a call this week with a target entry below 2040 and one week until expiry.
2. The Dax, The Dax, The Dax
The DAX
Call/Put = Call
Entry = Below 9800
Expiration = One Week
My Trading Advice
The DAX has been a confounding asset for me to trade but I must wade back in and try anew. The index has been wrestling with long term support and resistance as global trends and localized economics clash. The index is now trading near the upper end of the recent range with indicators pointing to a retest of long term highs near 10,000. I am trading the DAX this week with a call, a target entry below 9800 and one week until expiry.
3. Gold Shines Again?
Gold
Call/Put = Call
Entry = Below $1220
Expiry = One Week
My Trading Advice
Gold is looking good again. Long term economic outlook and near term flight to safety are cushioning dollar strength and lifting gold. Gold prices are now above $1200, above $1215 and moving toward the most recent highs near $1245. I am trading a call on gold this week with a target entry below $1220 and one week until expiry. The near term trend is up, and may continue, but be wary of earnings strength in the market, economic data and central bank policies.
4. The Bubble Burst
USO/Oil ETF
Call/Put = Put
Entry = Above $18.00
Expiration = Three Days
My Trading Advice
The trend in oil is down with no signs of a bottom yet. Momentum is growing, I was already bearish, and then a new downgrade to oil prices sent them sinking even lower. At this time there is high production, high supply, low demand growth and low demand outlook. We have more and more oil out of the ground every day and there just aren’t that many places to sell it. This is driving prices lower and will likely do so until a firm sign of production/supply reduction or a serious increase in demand expectation. I am trading a put on the USO this week with a target entry above $18 and only three days of expiry. I chose three days because momentum is high, carrying it lower on sheer selling.
5. Waiting On The BOJ
USD/JPY
Call/Put = Call
Entry = Below 119
Expiry = One Week
My Trading Advice
The USD/JPY pair has been bouncing along support for several weeks while the market digests economic data, Japan re-elected Shinzo Abe, the FOMC became a little hawkish and the BOJ faces growing expectation of QE. I remain bullish in the long term and only see this pair moving higher. I am trading a call this week while the pair is near support with one week until expiry.
More Tips by the Geek – 01/13 – 20/2015 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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