How we trade Microsoft Stock with binary options?
We’ve recently traded Microsoft stock at a binary options broker with very positive results and we would like to share our strategy so that you can also become successful in your trades.
Choosing the right broker will help you to get the maximum profit which could reach up to 90% with binary options.
It is important to follow the recent trends and the hot news coming from Microsoft Corp. At the same time reading the charts is critical for performing this strategy.
Microsoft Corp. Market Analysis
Earnings Release FY14 Q3 – 24 April 2014
Announced revenue for the quarter ended 31 March 2014 - $20.40 billion.
Gross Margin - $14.46 billion
Operation income - $6.97 billion
Net income - $5.66 billion
Diluted earnings per share - $0.68
Devices and Consumer revenue grew 12% to $8.30 billion.
Commercial revenue grew 7% to $12.23 billion.
In Jan 2014 Microsoft was traded at $37 compared to May 2014 - $40.
Hot news coming from Microsoft
We learned from Mr. Nadella’s conference that Windows 8 misstep cost the company a lot and they are moving forward to improve in this direction.
The new vision is built on the concept that all different devices should be properly integrated to work together as one single product.
Microsoft’s stock rallies after the company announced the new Surface 3 which is taken as a response to Apple’s 12” Macbook Air.
Trading Microsoft Corp. on the charts
Our strategy is based on identifying the key levels for support and resistances, and moving from there up or down.
We take for resistance the most recent highs at $41.66. If that level is broken we expect the price to go even higher so it would be a nice opportunity to buy hourly or daily Call Options.
As you see on the chart we are having two resistance (41.66 and 40.69) and two support levels (38.90 and 39.48).
The first scenario: current level is 41.28 and if it drops to the previous highs of 40.69 we are going for a daily Call Option. (Expiry: 23:59 GMT)
The second scenario: support we are taking at 39.48 which was a good level from the previous week – if that line is broke we will try to test our second support line at 38.90 so we buy daily Put Option in such scenario.
At the end of the day the first scenario was fulfilled as the price dropped to 40.48 and closed at 40.95 – so our daily Call Option expired in the money.
As you see on the chart here we have one support (40.00) and one resistance level (39.60). Our strategy is to buy daily Call Option from the current level: $40.11 (Expiry: 23:59 GMT) – this is our first scenario because it is over the support line.
We would buy a daily Put Option only if we see a break below $39.60 – the second scenario.
The Microsoft’s stock price expired at 40.32 so our first scenario finished in the money and we were happy.
For this type of strategy you need to know the market very well and to do some base drawings on the charts for support and resistance levels.