Binary options for currency pairs were also struggling to find a clear path. Besides the factors mentioned above, there was a disappointment from the leading European economy, as German GDP report declined sharply for the first time in a decade, raising worries that the economic slowdown might be even worse than it was previously discussed. The European Central Bank is not going to raise the interest rates this year, according to several sources, and that's a definite negative sign for EUR/USD. Traders were rushing to buy put options for the most popular currency pair which slipped below significant support range below 1.1250. Although the Friday's rebound added some optimism to Euro bulls, it was mainly caused by profit-taking rather than a bullish reversal. On the other side of the Atlantic, binary options for pairs with the US dollar were also mixed. Japanese Yen and British Pound were among losers, while commodity currencies such as the Canadian, Australian and New Zealand dollars gained a sudden strength. It's also worth noticing the continued uptrend in oil and gold prices. Investors were buying call options for the black gold on the back of supply-demand issues, while precious metals were bid amid lower yields in the US fixed-income market.
Monday kicked off the trading week with macroeconomic data in Britain. Put options were in demand for the Sterling pairs as all of the reports were deep in the red. The headline report was the UK Q4 GDP and it failed to meet the market consensus (0.2% versus 0.3% expected and 0.6% in Q3). Moreover, a decline of -0.4% was noticed in the month-over-month calculation (0.0% predicted, +0.2% previously) and year-over-year reading was also soft (1.3% versus 1.4%). In addition, Manufacturing and Industrial Production reports also disappointed investors. GBP/USD slipped below the mark of 1.28 last week, while GBP/JPY was testing local lows of 142.00.
Tuesday's price action was also comparatively quiet as investors were expecting more important data in the economic calendar later that week. Higher volatility was seen for AUD/USD as the Australian economy reported a softer-than-expected Housing sector data and modest gains in NAB consumer confidence. Japanese Tertiary Industry Activity Index came in with a negative reading as well. As a result, the Japanese yen was trading on a weaker tone. OPEC Monthly Report showed a decent cut in oil production and global supply, which forced traders buying call options for the black gold. WTI Crude started its impressive rally for the rest of the week. BoE Governor Carney spoke on Tuesday, stating that no support from the regulator is seen until the Brexit story will clarify the situation. US calendar was almost empty with JOLT jobs openings pointing to the strength in the labour market. However, the positive impact was rather limited in the currency market, while US equities were trading in the call mode.
The binary options market was focusing on the Reserve Bank of New Zealand on Wednesday. Although the 'unchanged' verdict was widely anticipated, a much more hawkish tone of the regulator was able to surprise investors. RBNZ officials underlined the strength of the local economy, pointing to an improvement in exports and overall positiveness. Some Kiwi bears were hoping for an interest rate cut this year, however, the regulators' hawkish rhetoric eliminated those expectations. Several sources even started talking about a rate hike in 2019, which was immediately reflected in the currency exchange rates. NZD/USD and NZD/JPY soared on the back of heavy demand for call options, breaching several crucial technical resistance levels. The uptrend continued throughout the whole week, which showed the sustainability of such bullish efforts. More strength is on the table is seen for the Australian dollar as well. British economy continued the negative sentiment with Consumer Price Index slowing down the inflationary pressure in the UK. CPI declined by 0.8% in January month-over-month while analysts were predicting a slide of 0.7%. The year-over-year calculation also failed to meet the market's expectations (1.8% versus 1.9%). Producer Price Index came in the red as well. As a result, the British pound continued the downside slide on Wednesday. In contrast, US CPI was a more bullish factor for the greenback (2.2% versus 2.1% expected). The US dollar index was edging up on heavy-volume buying of call options across the board. Oil prices bounced back a bit amid higher-than-expected US inventories.
The real volatility came on Thursday together with the Japanese GDP report failing to beat forecasts. The third largest world's economy grew by a modest pace of 0.3% in the fourth quarter of 2018, while many economists were betting on 0.4% growth. Private consumption was one of the weakest parts of the report. The Chinese trade balance unexpectedly surged in January with both imports and exports rising. That gave a strong driver for the global equities as investors were buying call options on the higher risk appetite. The only exception was the German GDP report which printed a stagnation in the fourth quarter of 2018. European GDP came in line with the expectations. Nevertheless, EUR/USD dropped below 1.1250. The biggest disappointment came from the US Retail Sales report (-1.2% In December versus +0.1% predicted). That situation might get even worse in January due to the negative impact of the government shutdown. US stock indices bounced off the local top but reversed next day.
Friday was just a continuation of the events took place the day before. The US dollar was mainly trading on the put-mode versus its major peers, USD/JPY recovered some of the previous losses, while AUD/USD and NZD/USD kept edging higher. USD/CAD failed to hold gains above 1.3300 and slipped below the support of 1.3250 on the back of rising oil prices. WTI Crude breached the local top of $55.33 per barrel, closing the trading week at a price of $55.75 for the first time since early November last year. EUR/USD also retraced toward 1.1300 resistance which used to work as the support level. The British Pound pared mid-week losses amid stronger-than-expected Retails Sales report. US NY State Manufacturing index grew in January, while Export and Import Price Indexes fell. Stock indices continued the rally across the globe on Friday, which leaves a room for more positive achievements this week.