JUNE 20-24 TRADABLE TRENDS FOR BINARY OPTIONS & SPOT MARKET TRADERS
FX risk hedged income, low risk forex, macro market outlook
Contributor Since 2009
Cliff Wachtel, CPA, MBA, former Chief Global Markets Analyst, Director of Market Research, New Media and Training for a number of leading online Forex and CFD brokerages. His focus includes global market drivers, forex, currency hedged and diversified income investing, and related topics like MLPs, REITS, BDCs, etc. He is also the author of The Sensible Guide To Forex , [https://www.amazon.com/Sensible-Guide-Forex-Smarter-Survive/dp/1118158075 ] a book dedicated to providing safer, simpler ways for active traders and passive long term income investors to use forex markets to limit risk of your currency being debased by central bank policies. Since the Great Financial Crisis began in 2007, Cliff was among the first financial writers to focus on stocks that provide steady, high yields currency diversification for insurance against currencies being steadily devalued. Articles focus on both top income stocks for exposure to multiple quality currencies, and safer, simpler less demanding types of longer term forex trades than commonly covered on other forex sites. He also posts a variety of articles on topics ranging from weekly strategic global market analysis, conservative forex trading, assorted special reports, currency diversified income investing, binary options, and trader training articles via multiple websites. His home sites include: globalmarkets.anyoption.com, thesensibleguidetoforex.com, caesartrade.com, globalmarkets.com, and others. Most can also be found at leading financial websites like seekingalpha.com, businessinsider.com, and forex sites like forexfactory.com and fxstreet.com. His work is regularly translated into numerous languages, including Spanish, French, Italian, Turkish and Russian, Arabic, German, and Chinese, often with his express knowledge and permission! He has appeared in a variety of offline publications including Forex Journal, and John Nyaradi’s book, Super Sectors, in which he was interviewed along with other market experts like Jim Rodgers, Dr.Marc Faber, John Mauldin, Robert Prechter, and Tom Lydon. Prior to his current positions, he was Chief Analyst at avafx.com, and a 30+ year financial market veteran as investor, trader, writer, analyst and advisor to private clients and institutions. He attended Vassar College and Cornell University, and is a certified public accountant. He’s married with 5 children and lives in Jerusalem, Israel, where he can follow Asian markets in the early morning, Europe through the workday, and the Americas at night.
Here are some selected established trends for forex, index, and commodity binary option traders and spot market traders. These are especially well suited for those trading binary options on a weekly and/or monthly basisOverall Risk Appetite Per The S&P 500
Looking at the daily chart for the S&P 500 as an overall barometer of risk, a few points stand out.
S&P 500 DAILY CHART COURTESY OF ANYOPTION.COM 03jun190512
While the index, and by extension most other risk assets, remains in within the Double Bollinger Band Sell Zone (DBBSZ), the area bordered by the lower 1 and 2 standard deviation 20 period Bollinger Bands (the lower green and orange bands). That suggests downward momentum), as described in 4 RULES FOR USING THE MOST USEFUL TECHNICAL INDICATOR, DOUBLE BOLLINGER BANDS.
On the other hand, the past week shows some signs of bottoming in the near term.
- The index remained in a rather tight, flat trading range, despite all the bad news, suggesting resilience that is a foundation for a near term bounce if things don’t get noticeably worse. As noted above, we expect the odds favor at least some calming on Greece (again, the fate of the banks, really) over the coming week.
- Notice that the index closed (see pointer) at the upper range of the DBBSZ) and just below its 200 day EMA (purple). It won’t take much of jump to make a break above these key resistance points and thus move from a bearish to neutral, possibly bottoming, technical outlook.
As the chart above shows, just buying a put on the S&P 500 has been a winning trade for most of June, and could well continue as long as the EU crisis remains a market focus.
However as we noted in our weekly article, JUNE 20-24 MARKET DRIVERS: IT’S THE BONDHOLDERS, STUPID (NOT GREECE),
This week could well see progress on the Greek situation that could send risk asses like this index higher.
Looking at the price action over the past week, while it remains in the DBBSZ, in fact the index has been in a fairly tight flat range, suggesting at least a near term bottom if not a bounce coming from some perceived progress on the Greek debt crisis.
As long as price stays within the DBBSZ, maintain bias to shorting the S&P 500 via daily or weekly binary options puts on this or similar indexes until the S&P 500 breaks above the DBBSZ and closes above both this area and the 200 day EMA.
Gold Weekly Chart: Both USD And EUR DistrustedGold is neither a risk nor safety asset, it is a currency hedge that can rise or fall in good times or bad, depending on how markets feel about the 2 major currencies, the USD and EUR. What is the longer term weekly gold telling us?
GOLD WEEKLY CHART COURTESY ANYOPTION.COM 05jun19 0536
- Given the worsening economic fundamentals of both the US and EZ, it’s not surprising that gold, unlike the S&P 500, remains within Double Bollinger Band Buy Zone, the area bounded by the upper 1 and 2 standard deviation Bollinger Bands (orange and green). That suggests continued entrenched upward momentum, making gold’s uptrend one of the more reliable up-trends.
- However, anyone entering long on gold should keep stop losses not too far below the $1500 zone, given the double layered support of the upper 1 standard deviation Bollinger Band (green) and 10 week (or 200 day) EMA (blue). That support could be broken if the EU can get markets more relaxed about the near term fate of the Greece and thus the EUR.
For weekly or monthly gold binary options traders, gold has been one of the most mindless ways to make money in the markets. With both the ECB and Fed facing deteriorating fundamentals in their respective economies, holders of both the EUR and USD have ongoing justification for buying this ultimate currency hedge. Note how gold in just bouncing off of support, suggesting this could be a buy on the bounce off of support opportunity to play via calls on gold binary options.
EURUSD Monthly Chart: Any EUR Bounce Higher Unlikely To EndureFor a longer term view of the EURUSD, look at its monthly chart.
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DISCLOSURE /DISCLAIMER: THE ABOVE IS FOR INFORMATIONAL PURPOSES ONLY, RESPONSIBILITY FOR ALL TRADING DECISIONS LIES SOLELY WITH THE READER. IF WE WERE SURE WHAT WOULD HAPPEN, WE WOULDN’T BE TELLING YOU FOR FREE, NOW WOULD WE?