Get Ready to Learn All About Binary Options
The EURO is dropping and the US dollar is rising. In fact the US dollar is at six month highs against many of the cross pairs. This is mainly based on the signs of the US economy is growing and the Euro economy is slowing.
What does this mean as Binary Options Traders?
Although it isn't that important on an intraday level, it can play a role when it comes to finding trends on the markets. As traders we all know that a trend can make you a lot of money. You need to not only know which way the market is going, but make good decisions when trades setup. Taking put options are going to be more widespread at binary brokers than call options on the EURUSD. You can read this site to determine which broker may be your best bet.
Recent political instability in Italy is just part of the Euro decline recently. Poor economic data keeps coming in. This could lead to the ECB to lower interest rates which will bring the Euro down even further. Although it may be getting priced in right now it's still up in the air at this point.
If you watch the currencies on the binary options markets you will see how you can trade each pair in several ways. This include real short term trading such as 5 minute options or longer periods of time, for instance a day. No matter which time you trade you better have a good idea of what news may come out affecting the markets.
Another thing that is waning in on the EURUSD are the $86 billion budget cuts. President Obama has signed them to order and this could make traders feel obligated to buy the very liquid dollar. As the biggest economy it does make sense.
Reports this week showed opposites for both the US and Euro economies. One showed few jobless claims while the other expanded. Also factory activity increased in the US while the EURO fell off a bit. Again, not huge news for binary traders, but it's smart to keep an eye on it. With Non Farm Payroll coming up you want to make sure you are on the right side of the market before you make a trade.
The Euro fell all the way down to 1.300 after a recent move up to 1.3700. If we see prices below this level we could see last years lows potentially. If you take a binary trade and see an old level of support make sure you keep it in mind when taking a call. These could b great areas to avoid put options. This recent fall in February is the biggest it has seen in 10 months at one time. Next month could get interesting.
Except Germany, most European countries are struggling to grow. With out the Germans the Euro would definitely be further down. Read more about the struggling euro economy.
Analysts are expecting the EURUSD to reach the mid 1.200's over the next few months. This type of prediction could lead to longer term traders taking some serious put options on the overall market for a lengthy trade.
Until a lot of economic issues get worked out in the Euro zone and the election gets solidfied in Italy, we are destined to see some interesting price action. Binary traders beware. Take the best setups when they come and keep an eye out for news times. This could save you a lot of money trading binaries. You may actually have to start trading other euro currencies as well. Consider the EURJPY and the EURGBP. These are two other pairs which will get affected by the slowing Euro currency.
Good luck with your trades this week and make sure you keep an eye out on all news events slated to come out. It could get really interesting in a hurry.
