AUDJPY Binary Options Strategy
AUDJPY was largely affected by the US Non Farm Payrolls (NFP) that was released on Friday. The employment data came in below expectations while negative revisions were made to prior figures. The NFP is one of the leading indicators for a possible rate hike of the Fed.
Heavy JPY buying forced Aussie yen lower in the Foreign Exchange (Forex) market but the cross managed to pare some of its losses prior to the weekly close.
AUDJPY 15min Chart
Please click on the chart to enlarge:
The 21 Moving Average (MA, in blue) was able to contain the weakness in AUDJPY where 78.42 is acting as the nearest support. Nearest resistance is seen at 78.55, which may suggest AUDJPY may be held in a range at the beginning of the Asian session if no substantial gaps are seen at the opening of the market. Upon successful re-tests of 78.42 or 78.55, binary options traders may look to capitalize over retracement off the support / resistance levels. By the book a 15min close is required above the support or below the resistance to affirm a successful re-test. A more aggressive approach would be to observe the 5min chart. A successful re-test on the 5min chart may be capitalized over via short-expiration such as 60 seconds to 2 minutes.
A firm break below 78.42 and the 21MA may trigger further weakness towards 78.32. Following a successful breakout the price tends to re-test the breached support / resistance level but such re-tests are not guaranteed. The desired expiration may range from 30min to 60min.
Similar to a break above the resistance, a break above 78.55 may encourage further gains towards 78.67. A re-test may be seen upon a successful break above 78.67 before a resumption of the uptrend on the 15min chart.
A successful re-test of 78.32 may initiate corrective gains in AUDJPY where the former support (78.42) now acts as the nearest resistance level. If AUDJPY ranges between 78.32 to 78.42 multiple trades may be taken off the support and resistance levels. A break below 78.32 may provide further weakness towards 78.23, which is expected to hold on the first test.
To provide further depth to the intraday strategy, a break above 78.67 may lead to further gains in Aussie yen but a firm resistance is seen nearby (brown line and 200MA in purple). We suspect it will be difficult to capitalize over a break above 78.67 in the binary options market. A successful re-test of the latter resistance may provide a cleaner entry for put binary options with a 30min to 60min expiration.
Our binary options intraday strategies are extremely flexible and may also be used on multiple time frames and different expirations to derive the signals from the market. Specifically for AUDJPY intraday strategy, the 15min chart and 5min chart may be more appropriate. Please note that trading short term binary options expirations (60 seconds and 2 minutes )are considered as aggressive form of trading.
As the binary options intraday strategy is released prior to the opening of the Forex market please note that if a gap is seen when the market opens it does not constitute as a successful breakout and the next key levels may be monitored.
Last Updated on June 5, 2016