Binary stock market indexes continued heading downwards in the European session today after yesterday’s sharp decline, that was caused by disappointing unemployment claims in the US, which were 8K above expectations. On the bull side New Home Sales rose by 9K above predictions and were 13K above their previous month’s reading. Currently the S&P500 is trading just a dollar below its yesterday low, which was formed at the psychological level of 1400. Today we are looking at the Core Durable Goods Orders indicator (on monthly basis), which worryingly is almost a whole percent below expectations at -0.4% versus the anticipated rise of 0.5%. The indicator measures the change in the total value of new purchase orders placed with manufacturers for durable goods, excluding transportation item. Another reason for the global binary indexes tumbling in the recent sessions is that market analysts don’t see enough progress in solving the Eurozone debt crisis. The indexes measuring Europe’s biggest economies – DAX30 and CAC40, fell more noticeably yesterday, since the European debt turmoil concerns them directly. Both indexes erased their mid-August rise and are currently trading at 6900 and 3402 respectively, where the prices were in the first third of the month. Crude oil fell sharply yesterday after the bulls yesterday were not able to push prices above the 98$ barrier. Gold is keeping its solid bull trend intact, and although it is still below yesterday’s extreme at 1675 it is still a solid buy, that gives a green light for all binary bulls willing to buy call and touch up options.
EUR/USD
Yesterday’s German Flash Manufacturing PMI came in a good number, which was 1.6 basis points above the predicted 43.5 basis points, but the lack of confidence in the debt crisis solution overwhelmed the binary market participants and the pair is currently trading almost a figure below the yesterday’s high at 1.2588. Technically the market is just above the overshot channel line that’s seen on the chart. The bears pushed the market way below the EMA20 and EMA50 technical indicators, and as the medium term trend remains bullish, the current prices should be considered a nice opportunity for entering with-trend trades. The closest support that is still holding is 1.2485. If the market forms a reversal pattern here it would be wise for all binary traders to but call options and touch up options and rely on move to 1.2530 at least. If the bulls don’t find enough confidence to start buying at the current levels, the market is exp3ected to continue to 1.2440.
Silver
Silver’s mighty bull rally was not left unnoticed by binary traders this month and they profited nicely from the soar in the metal’s prices. Although the price yesterday broke below the bull trend channel, this should not be considered as sign of trend reversal. On the chart we can see the beginning of a double bottom pattern, formed in today’s trading session at 30.20. In a bull trend, double bottom in a correction is always good for entries in the direction of the trend. The 50-period exponential moving average is just below the double bottom pattern, giving addiotional support to the trend followers. First target for all bulls is 30.81.
S&P500
The wide US index fell around 10$ yesterday after it opened with another 3$ down gap and closed just above 1400. The futures sign that today’s opening should be lower than yesterday’s close. The drop that started the beginning of the week formed a channel and we are currently seeing the price at its bottom line. This could act as a bullish confidence factor , but until price doesn’t break and stay above 1400, no bullish actions should be taken. Trigger for bull strength would be the break of 1404, where yesterday the market formed a small flag formation and continued down. In case today the bearish momentum from yesterday keeps its power up, we will see the market heading for 1395 and 1390. Since the market is way below the 20-period and 50-period exponential moving averages, only a break above the shorter period one would indicate reversal.
Disclaimer:
The information in this analysis is collected from different sources and should serve for informative purposes only. The author shall not be held responsible for the validity of the presented information. No part of this analysis recommends the purchase or sale of a currency pair or any other financial instrument.
