› Weekly Binary Options market review April 8 - 12.

Weekly Binary Options market review April 8 - 12.

Volatility eased, momentum remained, trends continued. That’s a short description of things that happened in the global binary options market last week. Investors absorbed negative news from the side of trade wars as the US and EU threatened each other with new import tariffs, while US-China trade talks did not show any significant progress. The second largest world’s economy reported much stronger-than-expected trade balance last month, as well as larger exports volume than economists were predicting earlier. That fuelled demand for high-yield assets as traders were rushing to buy call options for emerging markets, equities and risk currencies. Safe-haven assets were sold off on the back of robust carry-trade speculative flows; US 10-year Treasury yields grew, gold and Japanese yen weakened. The world’s reserve currency softened across the board as traders were buying put options for the US dollar versus Euro and commodity currencies. The deepest plunge was noticed for the USD/MXN currency pair as the Mexican Peso reflected capital flows into emerging markets. Oil prices kept climbing north despite strong US inventories report, and other commodities were in demand as well.

Monday was not so quiet as it used to be throughout several weeks recently. The thing was that lots of critical macroeconomic reports were published. Japan reported the current account data, showing that the financial sector struggled from the lack of additional liquidity. German exports and imports fell, but the overall trade balance was released with a much broader positive surplus than it was widely anticipated. The single European currency started its recovery versus the US dollar and the Japanese yen. The Canadian Housing sector confirmed BoC Governor Poloz’ assumption that the growth eased. As a result, the Canadian dollar was trading softer versus the greenback on Monday, testing local resistance of 1.3400. US Factory orders declined in March, while cap goods ex-defence were in the red after a flat reading in February. US equities investors reacted with heavy volume buying of put options for major stock indices. However, bearish action was limited and short-lived.

Australie published Home Loans report which showed that things aren’t that bad. AUD/USD was trading in a bullish tone, while AUD/JPY was accelerating the upwards pressure. Swiss unemployment rate remained unchanged in March, and the Swiss Franc struggled to find a clear direction versus the greenback. USD/CHF was hovering around the parity throughout the whole trading week. European economic calendar was empty, while traders were expecting the European Central Bank to meet the next day. Therefore, the volatility eased in Euro crosses on Tuesday. The only significant US report was JOLT jobs openings, which showed a moderate slide in the number of new jobs created in February. That was not a massive surprise after the big miss in Non-Farm Payrolls last month, so the US dollar continued trading in a tight sideways range.

Weekly Binary Options market review April 8 - 12.

Wednesday was the decisive day for most of the currency pairs. It started with weaker-than-expected machinery orders report in Japan, and the yen was trading in a put mode. BoJ Governor Kuroda added fuel to the fire by dovish comments, stating that the regulator is ready to act if needed. The British Pound surged on the GDP report which showed that the economic growth is much more robust in the UK than some doves might have expected. Industrial and Manufacturing production and Construction output were healthy as well. Although the overall trade balance was in the red, the currency speculators kept buying call options for GBP/USD and GBP/JPY in large volume, which lifted both pairs. ECB left the interest rates unchanged, but the real volatility started during Draghi’s press conference. The President was not so dovish in his comments as he was in the last meeting. However, he stated that the regulator is monitoring the current situation very carefully, and some supportive measures will be implemented shortly. The binary options market reacted with significant demand for call options for Euro cross-rates including EUR/USD. The most popular currency pair bounced off the local bottom and continued recovering towards 1.1300 resistance on Wednesday. US FOMC minutes were also positive, especially for US equities investors. Stock indices climbed towards all-time highs, completing the full recovery after the market plunge started in October last year. The US dollar sold off as chances for a rate hike were lowered. US Crude oil inventories came in with a sudden spike in stocks (7 million barrels versus 2 million expected). However, oil traders refused to buy put options, and WTI Crude added another 1% to its value as the weekly result.

Thursday was the inflation day. Chinese CPI and PPI failed to impress investors, while German and French consumer prices were flat in March. Nevertheless, EUR/USD was in demand, but the British Pound started sliding on the back of bad news from the Brexit front. US PPI report beat the market consensus in both month-over-month and year-over-year figures. That was not an issue for equities investors, but the fixed-income market was not pleased with that data. US 10-Year Treasury bond yields grew on Thursday, while gold was sold off.

Friday brought fresh air to the risk appetite. Chinese trade balance improved significantly in March ($32.65 billion versus $7.05 billion expected), exports soared 14.2%. As a result, emerging markets assets were in demand among binary options traders. Even weak commodity currencies picked up the bullish momentum. Industrial production recovered in Europe, which was comprehended as another positive sign for EUR/USD. US Michigan Consumer Sentiment slowed down in March, but that did not stop investors from buying call options for US stock indices and put options for the US dollar.

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