Binary Options Weekly Outlook: December 1 – December 5

December 1, 2014 – Weekly News

EUR/USD

Last week, the EUR/USD started at a 4-year low as the market was expecting negative European economic data. However, the German Business Climate surprised investors with its strong reading and pushed the pair back above 1.2530. At the end of the week we saw a downwards price correction and the price dropped to its current level of 1.2440. EU Inflation data showed an expected increase of 0.3% but the rate is still very low and could force the European Central Bank to expand monetary stimulus at their meeting this week. The meeting will take place on December 4^th ; if the bank decides to increase stimulus, the pair may slip well below 1.2400.

The U.S. Non-farm payrolls data will also be released this week and usually creates high volatility. The actual data will come out on Friday but we may see speculation before caused by pre- labor data.

GBP/USD

The GBP/USD continued to trade sideways for a second week. However, volatility slightly increased and the pair managed to break through its strong resistance at 1.5730 and climbed to 1.5820. The increase was caused by the U.K. GDP data which reassured investors that the British economy has been recovering, even though the increase in quarterly output was slightly lower than the previous reading (0.7% compared to the previous 0.8%). Later in the week, the pair began to drop as the Dollar strengthened and climbed to a four year high.

This week, traders should pay attention to several pieces of data. On Monday, the UK Manufacturing PMI and U.S. ISM Manufacturing PMI data will be released. On Wednesday, U.K. Services PMI & Autumn Forecast Statement will be released as well as the U.S. ADP non-farm Employment change. On Thursday, the U.K. Official Bank rate report and MPC Rate Statement will be released and finally on Friday, the U.S. Non-farm payrolls report will be released.

GOLD

Gold ranged above $1,190/ounce for most of the week as the market awaited the Swiss referendum regarding Gold reserves. An initial survey showed that more than 40% of the population would vote to increase reserves and this kept the price of the yellow metal high. At the end of the week, however, there was a change in opinion and a new survey showed that only 30% would vote to increase reserves. This pushed the price down to $1,170/ounce. The actual referendum was held yesterday and Switzerland decided to maintain the current level of reserves. The price dropped to $1,142/ounce but has slightly recovered since.

This week the main event for Gold traders will be the U.S. Non-farm payrolls report which will be released on Friday.

Economics events (GMT time):