Bollinger Bands are a helpful indicator for binary options traders due to the fact that they detail the current volatility level within the marketplace for specific assets. This indicator is not typically used as part of a detailed trading method, but by pinpointing higher or lower levels of volatility it can help traders decide the […]
Trading Around Key U.S. Economic Reports
There are several economic reports that binary options traders should pay attention to simply because they can provide excellent earning opportunities. Economic reports can impact not only the value of indices, but other major and minor assets as well. The following are linked to the United States, but all traders should note that many other major countries also release similar reports.
Consumer Price Index
The CPI report provides the overall value of various goods. The U.S. chooses which items to include, with other countries doing to same for their own report. The importance of this report is the fact that it can signal changes in inflation and overall economic conditions. Increases can foretell of an inflation increase. Decreases, when small, can indicate market stability. A decrease in CPI can also highlight reduced consumer spending, which can lead to an economic downturn.
FO reports reveal data related to the purchase of manufactured goods. When orders increase, this acts as an indicator of positive economic conditions. When FO reports are linked to a country that has recently experienced, or is experiencing an economic downturn, they can indicate either worsening conditions or the beginning of a recovery.
Everyone needs housing, and with an ever-growing population, the needs continue to increase. Housing statistics are often considered to be among the most important health indicators for an economic system. Binary options traders should analyze this data in conjunction with existing economic conditions so as to know what the overall impact on investor sentiment will be.
This data represents both the private sector and public sector. However, each is viewed in a different manner. Private sector jobs are often viewed as being more helpful to the U.S. economy because they represent balance and stability. Public sector jobs are viewed as being less beneficial, providing less direct benefit to the economy.
Farm workers are excluded from this report due to the fact that their jobs tend to be seasonal. A positive NFP report is considered to be a sign of a strong, or strengthening economy. A negative report signals trouble for an economy. Many traders trade around this report, as the fresh data almost always has some impact in the marketplace.
Gross Domestic Product
GDP data reveals the overall health of an economy. GDP is a measurement of all financial activities, including both governmental and non-public. Less than favorable GDP reports are viewed as potent warning signs that the economy is in trouble, while positive reports indicate the exact opposite.
Consumers can in many ways control economic conditions by deciding how, or if, they will spend their money. Elevated Consumer Confidence data points to a healthy economy. Reduced levels reveal the opposite. If consumers are spending less, an economy cannot grow and may even retract.
The dates and times of the release of each of these reports can be found online. Most traders choose to keep track of them by using an economic calendar. Even when not trading with assets that are likely to be impacted by the release of this information, it is wise to know what is transpiring within the marketplace prior to executing each binary options trade.
***Your capital may be at risk. This material is not investment advice.***