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Strong Yen Won’t Make Money on S&P 500

Options Trading — Mon, 19 Jul 2010 13:50:43 +0000

A strong Yen this morning will not make money for the S&P 500 and will likely begin reigning in the S&P 500 gains given at the open. Earnings season continues to generate trading opportunities. Overnight weakness in the Yen makes allowances for some of the bounce off of Friday’s lows but post-US open forex trading is indicating a reversal is in the cards. Strong euro overnight and at open is opposing the Yen move and appears dominant for the moment. I am watching for rising VIX and euro turn (weakening) as confirmation. Early Forex Trading in Yen Throws Us Our Bone Well the forex trading in Yen was kind enough to throw us our bone in the way of an intra-day peak in the S&P 500. We had our pick in at S&P about +0.6% on the day from which it has fallen to about neutral at noon EDT. We’ll be watching the Yen for weakness (not counting on it at this point) or falling VIX from this point (anything can happen there) as a signal to run our binary option hedge and will otherwise stand pat and ride out the day. Hope you are hitting your marks as well. [...]

Weak USD Pre-Market Makes Favorable S&P 500 Open

Options Trading — Thu, 15 Jul 2010 13:29:28 +0000

A weak USD vs the major forex trading pairs making for a positive open on the S&P 500. Futures are up slightly just prior to the bell. I will be watching the VIX in addition to the usual forex crosses to determine market direction today. My instincts tell me VIX falling today keeping S&P 500 up. The forex market crosses aren’t clearly pro-risk or anti-risk so I have to admit I’m not 100% what’s the motive force behind the cross rate activity pre-market. After the open we’re seeing strong anti-risk in the fringe cross pairs (NZL, AUD, etc.) yet also seeing strong EUR and weak USD (protending relatively favorable risk enviro). What is dominating trade this morning however is the Strong Yen (was mixed pre-open, now strong). This is presently driving the S&P 500 down. I am looking for a Yen reversal (weakening) as an opportunity to pick up binary option calls on my favorites, DIA and SPY – staying out until I see a S&P 500 bottom combined with peak in VIX and Yen. Forex Trading Action Reversal Looks like the market turned around 1:30pm, were you paying attention? I’m normally one to setup trades in advance, set trades [...]

Forex Market Option Trading Opening Indicator 7/7/10

Options Trading — Wed, 07 Jul 2010 13:33:32 +0000

Forex market options trading indicator for today showing weakness in the USD and Yen – normally a positive for the S&P 500 however the strength in the market is in GBP and CHF – making this a weak signal (I call this position “robbing peter to pay paul.”) Here’s the rub: taking money from one “risk free” forex market and putting it into another “risk free” forex market doesn’t move the equities markets. It’s a non-play to me. That being the case, I see the overall economic momentum dominating – ie down. Not long after the open money poured into the “risk currencies” driving the market up. This happened in the face of another bad Baltic Dry Index report – ie negative news. I say you be the judge: see short term money come into the market and fly into the light of higher stock prices… or see the phantom gains for what they are (ie short term bets) and look for an opportunity to buy binary option put contracts and wait for the inevitable end of day dive. Read more from Forex Market Option Trading Opening Indicator 7/7/10 - a post from: Binary Options Trading Tutorial - Forex Signals [...]

Daily Options Trading Outlook

Options Trading — Fri, 25 Jun 2010 14:06:40 +0000

Options trading outlook seeing unfavorable conditions in key forex crosses namely risk vs non-risk early today. Although the outlook is mixed net between all the pairs I typically look at mixed signals have usually meant downward pricing on risk assets. As per our usual caveat on forecast down days be on lookout for the stick save keyed by reversals in those same risk vs. non risk crosses. Have You Subscribed to Free Our E-Newsletter Yet? Get Trading Ideas Sent Right to Your Email Inbox as We Come Up With Them - Free!Also Don't Miss Out on the New Binary Options Trading Signals and Free Binary Options Trading Course Read more from Daily Options Trading Outlook - a post from: Binary Options Trading Tutorial - Forex Signals | Make Money Day Trading

Forex Options Trading | China Dropping Peg?

Options Trading — Mon, 21 Jun 2010 12:59:36 +0000

Forex options trading alert: According to an article put out by People’s Bank of China the Yuan peg to the dollar is going to be allowed to flex more. In Forex markets this morning, this has already had a dramatic impact on the “risk” currencies I mentioned in previous posts. Although the market is giving mixed signals right now – the overnight activity overall was strong in favor of risky assests. Expect a drop in VIX at open, sharp rise in DIA, SPY (S&P 500), and similar risk indices. Expect drop in US Treasuries. Retail traders won’t be able to take advantage of the initial move, but be watchful of our “risk” vs “safe” currencies. A continued rise in euro and commodities currencies (NZD, AUD, CAD) combined with falling USD and Yen portends rising stocks generally. The reverse obviously shows falling stocks. Check which way the money is flowing AFTER the open before deciding which way to go. That’s how I roll. Happy forex options trading today! Read more from Forex Options Trading | China Dropping Peg? - a post from: Binary Options Trading Tutorial - Forex Signals | Make Money Day Trading