Markets yesterday were bolstered by rumors that Greece would not be pulling out of the Eurozone. These rumors are based on some polls taken and not on any firm facts but apparently just a rumor of stability in Europe was enough to solidify a core of buyers to enter the market and push the major US indices higher. The Dow finished 1.01% higher on the day and closed at the 12580 level. The index is still down significantly from highs seen earlier in the month, but the last 8 sessions are showing signs of improvement. The S&P also headed higher by 1.11% to 1332 as the Nasdaq finished 1.18% higher to 1870. However, the major US indices are still down by approximately 5% each for the month of May, the biggest drop since September. In our opinion, this is not the end as the fact that the Greek elections will be held only on the 17th of June, leaves a lot of room for volatility in the markets until then. Without this Greek issue closed, it is difficult to see stock indices rising in any trending manner and as such, we see it as a sign to analyze and trade other asset classes like individual stocks, forex pairs, and commodities. We have been actively recommending forex pairs heavily of late and look to continue to do so as this has been an incredibly profitable means of trading.
The EUR/USD for example provided a SELL signal yesterday. We reported that any break of the 1.2520 level would allow binary traders to take Down options with a low-risk trade. The market did in fact break below this level and ended the day yesterday below this level, leaving us in profits. The currency pair is currently trading near 1.2465 and is already 22 pips down for the day; nearing the 1.2450 level which is of importance. It isn’t a technical support but it is significant and any break below this level will allow binary traders to take another Down option.
The GBP/USD broke below support of 1.5655 yesterday as well, leaving us with yet another profitable trade. The current target is for a break of the 1.56 level and below that 1.5540. Those are the supports for the day and a break of either of these will warrant Down option trades for the day
For stocks, Our Apple stock (AAPL) recommendation from last week also turned a profit yesterday as the 567.5 level broke to the up-side. We didn’t expect this to occur yesterday but it did and we took Up options as the stock price began heading higher. The stock finished the day at 572 and looks to continue the trend higher today towards 582. We expect any break of 582 to allow binary traders to take Up options with little risk of a reversal back down.