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Taking Binary Trades During a US Govt. Shutdown

It’s Tuesday, October 1, 2013 and we just took our morning binary options trade on the EURUSD and it ended up working out really well. Today has many different factors involved when it came to our trade. The US government is going through the shutdown process because the Democrats and Republicans can’t get along once again. This has led to an interesting price action market on the US dollar currency pairs. We tend to look at the EURUSD and that is exactly what we did today at Traderush. We talk about news trading and pleading for position after the news comes out. This is a critical piece to taking trades on a news trading kind of day. Fortunately for us, we traded the EURUSD just before a significant news event occurred.

Price action had reached highs of the last eight months this morning. It was trying to reach the whole number of 1.3600, but failed to get there. We noticed price action had come off the resistance one level and was trying to make a run at the highs of the day. Momentum wasn’t necessarily strong to the North Side and this is when we decided to take our put option. We got in this trade with 10 minutes to go. Price dropped like a rock after entry and we never saw an ounce of pain. Over the course of this 10 minutes, every candle was down until the last 3 minutes. These are the types of trades that make trading easy on a daily basis, but of course you can’t expect this every day. Price did bounce up a little bit but gave us a nice 10 Pip winner for our trade of the day. Soon after the close, price had dropped off once again based on the news event.

The image below shows the price action that occurred throughout the morning. You can see are green arrow pointing to the south side. Notice the big red candle, two small green candles and then more dropping candles after that. We did have a nice wick coming down to the pivot level that was challenged at news time. This was a nice entry for a news trading reversal. Price tested the pivot level and extended through it which gave you a nice call option set up if you were willing to take it. Price has since climbed up roughly 15 to 20 pips above the pivot and is continuing to climb back to the whole number 1.3600. It should be interesting to see whether we get there or not today, but at some point this week we should reach this new high. Keep an eye on your levels and try to take the best trade setups possible.
Take the Shutdown Trade
So far this week we’ve had two good trades and we’ll continue trading the rest of the week, including the nonfarm payroll news event that’s supposed to occur on Friday. It’s still questionable of whether it will come out based on the US government shutdown, but we will trade will we see no matter what occurs. Try to find the best setups possible when looking for your trade and not force yourself into a position. Certain trades may show a sign, make sure you have a couple of catalysts working for you. It will make a lot more sense when you have other factors involved. Make sure you include wider time frames, wicks, whole numbers and daily lows and highs. If you have any questions about trading the binary options market you can always ask us.

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