Tip from the Geek 02/23 – 03/02/2015: Global Markets Reach New Highs….Now What?
Top 5 Weekly Binary Options Trading Signals by the Geek
The global markets reached new highs at the end of last weeks and many extended those gains at the start of this week. The major catalyst at this time is the ongoing Greece/EU bailout discussions but we need to remember there are underlying trends supporting this move. The Greece news is good, I hope they keep moving forward with their plans but I honestly don’t believe we have heard the end of it. Until then the newest agreement has allowed markets around the world to breath a sigh of relief. Aiding this was a little good news on the Japanese and Chinese economies, strong earnings from the tech sector and the ongoing recovery in US labor trends. What didn’t aid the market was the FOMC minutes. The minutes were wishy washy, dovish, not in line with economic trends and has caused some confusion over when their intended interest rake hike will actually come.
This week could be another wild ride. The markets have broken out to new highs but the rally is on tenuous footing and there are many things on tap this week that could knock of it off balance. For one earnings are still rolling in. The bulk of the important names have reported already but there are still several thousand mid-cap names on the calendar. This week alone is one of the busiest of the season with a minimum of 1,000 reports on the schedule. There is also a lot of economic data due out. This week housing is on tap as well as important reads on the manufacturing sector and a revision to 4th quarter US GDP. Don’t expect too much out of the existing and new home sales numbers, look to the pending sales for signs of growth in the future. The GDP could be revised lower but is not unexpected and rear looking at best.
1. Don’t Buck The Bull
S&P 500
Call/Put = Call
Entry = Below 2105
Expiry = One Week
My Trading Advice
You shouldn’t try to buck the bull or the bull with buck you, sounds good right, I just made that up but whatever. The market is rising and has broken to new highs. The indicators are rising, strong and in line with the underlying trend. The index is sitting above long term support, support that has as many layers as an onion and a foundation built on a three year trend line. Economic data is consistently improving and building momentum on many levels. Earnings are still steady and although the 1st quarter is expected see overall earnings growth decline, ex-oil is still going to be fairly strong. Altogether these add up to a lot reasons why I am not going to be trading a put this week. Not to mention the fact that last Friday was expiration day for equity options so now the market is free to move for at least 4 weeks.
This is one of those times where trusting the charts can get hard. The charts are bullish, the signs are there and the market is at new highs but there are many reasons to fear a correction. This fear may keep some out of the market but not me. Too many times have I second guessed myself, traded counter to these signs and lost out.As a technical trader I have to follow the lead of the market through price action on the charts and this is why I am trading a call. My target entry for the week is below 2105 with one week until expiry.
2. Oil Bears Not Gone
USO/Oil ETF
Call/Put = Put
Entry = Above $18.65
Expiration = One Week
My Trading Advice
The oil bears are not gone. Why? Because supply/demand imbalance has not stabilized. Not only are stockpiles still on the rise global production continues to improve or at least remain steady. One of the newest headlines that may send prices lower are reporting Libya’s el Sharara oil field is back on line. Regardless, the trend is down and prices are bumping up along the down trend line. The indicators are in line with a bearish buy and so I am trading a put. My target entry is above $18.65 with one week until expiry.
3. Does Gold Bounce?
Gold
Call/Put = Call
Entry = Below $1200
Expiry = One Week
My Trading Advice
Does gold bounce? That is a question hard to answer in the wrong context. The metal obviously will not bounce, but prices can and this week it looks like they will. Spot prices for gold fell below $1200 over the weekend, a sign that many took to be bearish, and then climbed back above as the global market began to awaken. By the time the US market was opening gold prices were back above $1200 and indicating support at this level. There may not be a rally now, but long term buyers are in the market and $1200 is nice looking point of entry. I am trading a call, targeting intra-day weakness fo entry. My target entry is below $1200 with one week of expiry.
4. Rising Tide Lifts All Boats
USD/JPY
Call/Put = Call
Entry = Below 118.90
Expiration = One Week
My Trading Advice
The longer term uptrend we have all been trading in this pair may be over, there, I said it. The near term uptrend in the pair is not. While there is some question about the state of Japaneses economics and the start of FOMC rate hikes these is no expectation for significant moves by either party in the near or short term. At best the FOMC could change their statements but until then the pair is likely range bound but supported by a rising tide. At this time the pair is moving higher, above the moving average, supported by the indicators and moving in line with what at least was the long term trend. Resistance is far above the current level so I am trading a call with a target entry below 118.90 with one week until expiry.
5. Reaching Equilibrium
USD/CHF
Call/Put = Call
Entry = Below 0.9475
Expiry = One Week
My Trading Advice
The USD/CHF has been in major flux since the SNB made their surprise move last month. Since then the pair has corrected and bounced, and is now reaching equilibrium. Reaching however does not mean reached and this pair has some more upside potential. Price action is bullish, the pair is above support with rising indicators so I am trading a call. My target entry is below 0.9475 with one week until expiry.
More Tips by the Geek – 02/23 – 03/02/2015 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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