EUR/USD – Technical Analysis for Binary Options Trading
Eurozone – German Ifo Business Climate Index
Today, at GMT 10:00 a.m., the Ifo Institute for Economic Research published this month’s German Business Climate index. The Ifo Business Climate figure measures the level of a composite index, which is created by surveying around 7,000 businesses in Germany by asking them to rate the comparative business conditions of now and in six months.
Since the survey has a large sample size compared to similar studies, binary options investors consider the Ifo Business Climate to be a strong leading indicator of the overall economic optimism in the country.
Last month, the German Ifo Business Climate index came out at 110.4, and this month, the forecast was set slightly higher, at 110.7. However, the actual figure came out much better than what the market was expecting, at 111.0.
United States – Core Durable Goods Orders
On Wednesday, at GMT 2:30 p.m., the US Census Bureau will release the month-over-month core durable goods orders figure, which measures the changes in the total value of all new purchase orders made to the US manufacturers for durable goods over the past month. However, the US Census Bureau excludes goods from the transportation sector in this figure in order to offer an accurate picture.
Binary options traders consider the US core durable goods orders to be the primary gauge of production situation in the economy, as an increase in purchase orders indicates that US manufacturing activity and growth will happen in the near future. Hence, it is one of the key leading indicator of the overall US economy.
Last month, the US core durable goods orders increased by 0.8% and the forecast for this month is currently set at an increase of 0.2%.
Trade Recommendation for the EUR/USD
Since forming a large bearish outside bar (BEOB) on November 9, 2016, the EUR/USD has remained in a strong downtrend and formed a well-respected downtrend line in the process.
However, after reaching near the 1.0520 level, the EUR/USD found a strong support and the price remained above this level for two weeks. But, last week, the EUR/USD finally broke below this support level and formed an inside bar.
As the US core durable goods orders are expected to increase by an additional 0.2%, we believe it would further accelerate the downtrend. In that scenario, if the EUR/USD price breaks below last week’s low, which is at 1.0366, it would attract additional bearish momentum in the market that could push the price further down.
Under the circumstances, it would be recommended that binary options traders consider placing a PUT order for the EUR/USD with their binary options trading brokers as soon as the price closes below the 1.0366 level on the daily time frame.
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