Binary Options Analysis – Trade of the Week: EUR/NZD – June 15, 2015

Eurozone – Final Consumer Price Index (CPI)

EUR currency tradingOn Wednesday, at GMT 9:00 a.m., the Eurostat will release the year-over-year final CPI, which measures the changes in the price of goods and services bought by Eurozone consumers over the past month. However, this data is measured in an annualized format (y/y).

The final CPI (y/y) is the revised version of the flash estimates, which is released prior to the final version. Since the consumer price index is used by the European Central Bank to measure inflation in the Eurozone economy, binary options investors consider the final CPI to be the most important inflation data for the Eurozone economy.

In May, the Eurozone’s final CPI reading came out at 0.0%. However, the expansionary monetary policy of the European Central Bank over the past month has been very effective. Hence, the forecast or flash CPI for June has been set at 0.3%.

New Zealand – Gross Domestic Product (GDP)

Later, at GMT 10:45 a.m., the Statistics New Zealand will release the quarter-over-quarter Gross Domestic Product (GDP) of the country, which measures the changes in the value of all products and services created in the New Zealand economy over the past quarter.

Binary options traders consider the Gross Domestic Product to be the broadest estimate of economic activity and the primary gauge of the economic health in the country. Hence, any significant change in the GDP (q/q) would likely create significant market impact.

In the first quarter of 2015, the New Zealand GDP grew 0.8% compared to the previous quarter. The forecast for second quarter of 2015 is currently set at a growth of 0.6%.

Trade Recommendation for the EUR/NZD

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Since reaching the 161.8% Fibonacci extension level of the last major bearish swing on April 21, the EUR/NZD has embarked on a strong uptrend over the past two months.

On June 5, the EUR/NZD penetrated below the low of the bearish pin bar, which was formed on June 4. However, the lack of additional bearish momentum soon pushed the price above the pivot zone around 1.5700.

Later, on June 10, the EUR/NZD again penetrated below the 1.5700 level, but ended up moving further up and formed a large bullish outside bar (BUOB) in the process.

Currently, the EUR/NZD is trading near the 261.8% Fibonacci extension level of the downward swing between 1.4935 and 1.5405.

Since the Eurozone inflation is expected to reach 0.3%, it would likely attract additional bullish momentum in the next few days. Hence, it is recommended that traders consider placing a CALL order with their binary options brokers for the EUR/NZD, once the price penetrates and closes above last week’s high, at 1.6165.

Recommended Broker: HighLow.net

About our Forex and Binary Options Analyst:  Asif Imtiaz

Asif worked as a prop trader for almost a decade, and later he managed trading operations for one of the largest foreign exchange strategy developers in Europe. Currently, he works as a trading consultant to several brokers and writes on various tech and financial topics. You can reach him at contact@asifimtiaz.com

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Asif Imtiaz

Asif worked as a prop trader for almost a decade, and later he managed trading operations for one of the largest foreign exchange strategy developers in Europe. Currently, he works as a trading consultant to several brokers and writes on various tech and financial topics. You can reach him at contact@asifimtiaz.com

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