Euro - German Business Sector Index Ifo
Today, at 9 am, the German Ifo Institute for Economic Research released the German Ifo Employment Index, which measures the level of the index through a survey of 7000 manufacturers, builders, wholesalers and retailers in the country.
Binary options traders consider the Ifo business sector index to be an important and leading indicator of the general state of the economy in Germany due to the large sample survey. Moreover, businesses tend to respond first to changing economic climate and business conditions. Since, the index is based on the opinions of major companies, it can always indicate the future economic conditions in the country.
Since the German economy makes up a large part of the Eurozone economy in general, the German Ifo Business Sector Index can have a significant impact on the valuation of the Euro against other major currencies.
In January, the German Ifo Economic Climate Index came in at 106.7 and the forecast for February was slightly higher at 107.4.
USA - Existing Home Sales
Later in the afternoon, at 03:00 GMT, the National Association of Realtors will release the Existing Home Sales Volume, which measures changes in the annual number of homes sold over the past month. However, this figure does not include any new construction of housing facilities in the country.
Existing home sales usually have a significant impact on the local economy as there are a lot of economic activities associated with selling a home. Like a new mortgage, home renovations and other purchases made by new homeowners affect the local economy in a positive way. That is why binary options traders view the volume of existing home sales as an important leading indicator of the overall economy in the United States.
Last month, US home sales came in at 5.04M and the forecast for this month was 5.03. While the forecast is very close to last month's sales volume, anything less than 5 million will make the market eagerly watching the future course of the US economy.
Trading recommendations for the EUR/USD currency pair
Since May 8, 2014, the EUR/USD has been in a steady downtrend, with its decline accelerating further in December 2014 when the pair reached a record high of 1,1097. Since then the EUR/USD has bounced up and broke the average downward sloping trendline. Regardless of the rebound, it is not possible for the EUR/USD to break above the 1.1500 resistance and it is currently trading within a narrow range, 1.1278 and 1.1500.
Over the past few weeks, binary options traders have been concerned about the state of the US economy due to the lack of Q4'14 real GDP growth and increased unemployment claims. If the annual existing home sales figure falls below 5 million, an upward momentum will be added to the EUR/USD rates. In that case, if the price of the EUR/USD currency pair rises above the resistance level of 1.1500, it is recommended that Binary options traders puts CALL orders with this currency pair.
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