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Binary Options Trading Monitor for July 19, 2010: Call Buying in the VIX Highlighted

|Includes: Jefferies S&P 500 VIX Short-Term Futures ETF (VIXX), VXX

The Binary Options Trading Monitor highlights traditional options trading of the underlying assets currently available on the leading binary options trading platforms. With a focus on short-term activity, binary options traders can use this intelligence to gauge stock sentiment and help assess potential stock movement in the coming weeks.

Notable Options Trading:

CBOE Volatility Index (VIX) - Bullish: After a week of mostly bearish flow in the VIX, the last couple of sessions have seen investors positioning for an increase in market volatility over the next month or so. On Monday investors scooped up 50k August 60 calls in the VIX likely as a hedge against a sharp drop in the markets. Investors don’t necessarily need the VIX to trade above the 60-level  (a 130% gain from current levels) to yield a profit; all they need is for the VIX to spike higher sometime over the next week or so, causing the premiums on those calls to increase and allow for the investors to trade out of the position for a nice profit. VIX binary options can be traded on the Anyoption platform.

Binary Options Weekly:

This week in the Binary Options Weekly we follow-up on our discussion of how binary options traders can take advantage of patterned stock movement during the last few trading hours of traditional options expiration by providing a list of names to watch closely during this month’s expiration for pin risk strategy implementation. We provide detailed steps on how to potentially profit off this pinning behavior. In addition we discuss recent options flow and how this trading can possibly be a sign of things to come in the markets over the next few weeks.

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Disclosure: No Positions