Binary Option Setups: Week of July 25th – 29th

BinaryOptionsNow | Published on July 25, 2011 at 9:17 am

AnyOption review

The current turbulent economic times – a result of the simultaneous US and EU debt crises –  may provide lucrative opportunities to profit from binary options investments that take advantage of the short-term volatility in the major forex pairs.

 

Potential Binary Option Setups

Here is a list of economic events that may provide the right conditions for a forex binary option investment to finish in-the-money:

1. US New Home Sales (Monthly) – Tuesday, July 26th 3:00 P.M. GMT – The New Home Sales reading is a leading indicator of economic health in the US, which is provided by the US Census Bureau. A higher than expected reading should be taken as positive for the USD, while a lower than expected reading should be taken as negative for the USD.

The previous New Home Sales figure released on June 23th and came out at 319K, which was positive since the previous forecast was for 310K. The forecast this month is 320K.

If the general sentiment is that the New Home Sales will come out far below the prediction of 320K, it may be prudent to invest in a call EUR/USD binary option with the idea that US dollar will decline in value vis-a-vis the euro.

If, on the other hand, there is grounds for optimism and the feeling is that the New Home Sales reading will be much higher than 320K, indicating a positive outlook for the US economy, it may be prudent to invest in a put EUR/USD binary option with the expectation that the dollar will increase in value against the EU’s single currency.

2. Australian Consumer Price Index (Quarterly) – Wednesday, July 27st 2:30 A.M. GMT –  The Australian CPI is an effective way of measuring changes in purchasing trends and inflation in the country. It is released by the Australian Bureau of Statistics and a higher than expected reading should be taken as bullish for the AUD, while a lower than expected reading should be taken as bearish for the AUD.

The previous figure released on April 27th was 1.6% which was quite positive since the previous forecast was for 1.2%. The forecast this month is 0.7%.

An opportunity to profit from a AUD/USD forex binary option may present itself if the CPI data is much higher or lower than the predicted outcome.

Should the reading be higher than expected, this could indicate that expectations for the AUD are positive and the Aussie may in turn be buoyed by these expectations and increase in value against the US dollar. In this case, an investment in a put AUD/USD binary option at or around the release of the retails sales data may finish in-the-money.

If, on the other hand, the CPI figures come out way below expectation, the AUD may be negatively impacted by this data and lose ground against its US counterpart. In that case, a call AUD/USD binary option investment made at or around the release of the data may finish in-the-money.

3. US Advance Growth Domestic Product (Quarterly) – Friday, July 29nd 1:30 P.M GMT – The US GDP is the broadest measure of economic activity and the primary gauge of the economy’s health. A higher than expected reading should be taken as positive for the USD, while a lower than expected reading should be taken as negative for the USD.

In the current tumultuous economic times with ongoing negotiations between lawmakers in Washington, DC over raising the US national debt ceiling, the US GDP figures could have a an impact on the value of the US dollar in the forex markets.

The previous GDP figure released on April 28th was 1.9% (revised from 1.8%) which was not surprising since it was exactly what analysts had forecasted. The forecast this month is for a figure of 1.7%.

If a trader anticipates that GDP is likely to affect the exchange rate of the dollar, one way to profit would be to invest in a EUR/USD or a GBP/USD binary option that expires 30 minutes to one hour after the reading is released.

A higher than expected GDP number could indicate that the US economy is strengthening and, in that case, a put on an EUR/USD binary option, for example, executed at or around the release of this data could take advantage of this positive US dollar indicator and finish in-the-money. A lower than expected result, on the other hand, could allow for prime conditions to invest in a call EUR/USD binary option.

As always, keep in mind that the major forex pairs are constantly being influenced by many other factors beyond the release of economic data and that previous results do not guarantee future outcomes.

 

For more binary options news and information, follow us on Twitter!

GD Star Rating
loading...
GD Star Rating
loading...
Binary Option Setups: Week of July 25th – 29th, 5.0 out of 5 based on 1 rating

Comments

Subscribe

Sign up for our Newsletter
IQoption banner
24option banner

Top Binary Options Brokers

91% Returns
in case of correct prediction
RISK WARNING: YOUR CAPITAL MIGHT BE AT RISK
3 Types of Options
Free $500 Demo Account
15% Protected Returns
Most Advanced Trading Platform
88% Returns
Free 100% Trading Bonus
89% Returns
Free 100% Trading Bonus
24option banner

Binary Options Video