Euro gets the Tension of Traders
Many of those who made the transition from Forex to binary options trading did so because they seek to expand the range of underlying assets. This doesn't mean that they have completely forsaken currency pairs, as these are some of the most frequently traded underlying assets. The best thing is that one can trade ETFs instead of simply juggling with currency pairs, and those involving the Euro are those that traders should focus on right now.
The Currency Shares Euro Trust had a very interesting evolution this year, sinking ever deeper until July when it reached the minimum level of $120. The trend entered the reversal in mid-summer and by the end of September climbed above $130, the value around which it revolves right now. By taking a close look at the weekly charts, traders will realize that a flag formation takes shape and it is not unlikely for the rally to end when the price sinks below $127.
A very different development had the ProShares Ultrashort Euro in 2012, and it comes as no surprise that its peak was recorded in July and the downswing began immediately after. The resistance line stands at $20.1 and the weekly OBV failed to cling to July highs. Traders were not shocked by the fact that stock prices declined following the September surge, but they were surprised by the dramatic fashion in which the stocks were corrected.
Recent reports about the state of the economy and the GDP are slightly contradictory, which can be explained by the fact that the reality is distorted during elections. Nevertheless, from a technical analysis standpoint, recent data suggest that the dollar is ready to strengthen up against the Euro, which is on a mild but steady decline.
Binary options traders don't have to count on or expect something extraordinary coming from the Euro zone, to be confident in opening such a position. The risk of opening long positions at $19.65 for the ProShares Ultrashort Euro with a stop loss at exactly one dollar below, should keep the risks at a reasonable low 5%.