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In a move made to compete with Skype and possibly Apple, Google is now offering a feature which allows users to use the phone to contact one another via Gmail. It will be interesting to see if Google will provide better reception than that of the iPhone. And if it eventually provides the ability to use this from a mobile phone, then it will truly compete with the iPhone as a service provider.
For now, the feature is only available in the US, but once it is available throughout the world, it will be interesting to see how this will affect the price of Google stock. Advanced investors may be able to take advantage of binary options and game the news ticker, watching carefully for when Google makes the feature available worldwide and when it expands features. You can see our previous entry written in March for more of an explanation on how to use this strategy to make a return on your investment.

Of course, not everyone agrees that China will be growing so fast. A couple of major problems loom: China’s GDP has indeed been growing rapidly in the last 30 years, but that could be because it has a while until it reaches a high rank. Chinese GDP is still below the 100th rank in the global economy. Another factor making it difficult for China to climb to the top is the state of the current global economy, the decrease in demand for exports and the rise of unemployment.
Some experts even feel that China’s GDP will fall in the next few years. Hedging might be a great binary options and forex strategy for traders of forex and binary options for those who are cynical about the Chinese takeover of the world.

What this means for traders:
Traders might want to pay attention to the Asian currencies, in particular the yuan, the Chinese currency which the Chinese government decided earlier to peg to the dollar (see our previous post). This in turn makes Chinese exports more expensive, but imports cheaper. Be on the lookout for trades connected to rises in production expense and major companies such as Wallmart and Target, who have overseas factories. Other companies which have been cheaper alternatives to American products, such as Toyota and Honda, may also present good binary options opportunities.

What this means for trade operators:
Chinese stocks and markets are a new opportunity for traders. The Asian market will also be influenced by its #2 neighbor. Read more about online trading in the binary options market.

If you’ve seen “Love and Death,” there’s a quote there about wheat. As the story takes place in Russia, it is suitable for a country who is the world’s top exporter of grain.

Russia’s five-month drought brought a ban on wheat exports. As Russia is one of the main producers of wheat, this is has driven up the price of wheat to its highest in two years on August 5. The price of corn is related to the price of wheat, as both are used for animal feed. Traders who find that grain futures are soaring may instead choose to invest in soybeans and corn, although corn is rising along with rice.

What this means for you:
Traders might want to capitalize on this market trend for short-term binary options. Traders can place trades on wheat and hedge it with trades on soybeans and corn, perhaps more stable investments.
Operators might want to add more instances of commodities options to their sites for traders to benefit.

Best Month in a Year
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One great way to make binary options work to your advantage is to trade based on monthly and quarterly earnings reports. Options can be predicted to rise or fall shortly before these news releases. If you do the research you can capitalize on these movements in the market. But more on this strategy at a later posting. Now let’s concentrate on our monthly report.
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Stocks did better this month than they have in an entire year. Sixteen of the thirty DOW stocks ended higher at the end of July, including Home Depot (up 1.6% at $28.51) and Boeing (up 1.4% at $68.14). Intel (down 1.7% to $34.46) and Merck (down 1.7% to $34.46) ended lower than expected.

Stock Market Summary

News Events of the Month-

Technology News-

Economic News-

Currencies-
The dollar rose against the British pound and Euro but fell against the yen.

Savings and Consumer Spending-
Consumer sentiment for July rose to 67.8 and not the expected 66.5.

Commodity Market
Oil, gold, and copper all rose in price.
Gold- $13.30 to $1,181.70 per ounce.
Copper- up 2.15 cents to $3.3115 a pound, up 12% for July.
Oil- closed at $78.95, up 4.39% from last month.

Employment
Increased to 9.6% from 9.5% for last month for the US market.
Private employers added 90,000 jobs to the payroll, an improvement since June.

Sales and Manufacturing
Manufacturing activity slowed to its lowest level since December. Reports of Midwest manufacturing rose to 62.3 this month from 59.1 for last month.

Oil from a BP underwater oil rig has been gushing into the Gulf after an explosion and fire April 22. After many failed attempts at controlling the leak, BP finally managed to contain the oil by placing a cap on the well and direct oil out of the water into the surface for use. Oil however, continues to leak into the Louisiana coast and the Florida Gulf.

Past estimates of oil leaks of 12,000 to 19,000 barrels a day (504,000 to 798,000) have now been raised to 20,000 to 40,000 barrels a day (840,000 to 1,680,000 gallons) before the leak was contained by BP.
The London-based oil company has broken the record for the worst oil spill in US history. Oil from an Exxon Valdez tanker off the coast of Alaska’s Prince William Sound spilled over 10 million gallons into the ocean. This was previously the worst oil spill in US history.

Oil spill cleanup has cost BP thus far $1.4 billion on cleanup.

Investment analysts recommend buying BP stock, using an old investment strategy of buying cheap stock during a crisis, waiting out the storm and selling when the price goes up. Stock prices have dropped to almost half of what they were before the oil spill, although intraday trading prices fluctuate enough for the binary options trader to predict the hourly movement of the stock.

This strategy benefits you mostly when you have two options with a range of expiry, where both options could be in the-money. Then you are able to minimize your risk but   also maximize your gain.

This option is almost most popular in forex binary options, in which the value of the currency can change very quickly in either direction. In this scenario, hedging could be a viable option for reducing risk to the trader.

Take the following scenario of a forex binary option based on the price of the Euro. The Euro has been rising and is predicted to continue to rise at a determined breakout point. At this point you would place a call, expecting the Euro to rise. But what if the price changes quickly and falls? You can place a put option at another point, helping you to minimize risk in the event that the price indeed falls.

In the above scenario, you have placed a call for $500 at the option price of 5.1. You have also placed a put for $500 at the option price of 5.3.

The following outcomes could occur:

• The Euro price could expire at 5.1 exactly, making your call option at-the-money. You would receive $500 in return of your initial investment. In this case your put option would be in-the-money, and you would receive $850 on your initial investment. Total investment= $1000. Profit= $350. This trade would end up being a net gain. (-500 + 500 + -500 + 850)
• The Euro price could expire between 5.1 and  5.3, making both your put option and your call option in-the-money. You would receive $850 for both trades.  Total investment= $1000. Profit= $700.   (-500 + 850 + -500 + 850) This trade would end up being a net gain.
• The Euro price could expire below 5.1, making your call option out-of-the-money. You would receive $75 in return of your initial investment. In this case your put option would be in-the-money, and you would receive $850 on your initial investment. Total investment= $1000. Profit= – $75.   (-500 + 75 + -500 + 850) This trade would end up being a net loss, but you still lose much less than you stand to gain in other scenarios.
• The Euro price could expire above 5.3, making your call option at-the-money, and you would receive $850 in return of your initial investment. In this case your put option would be out-of-the-money, and you would receive $75 in return of your initial investment. Total investment- $1000. Profit= -$75.  (-500 + 850 + -500 + 75) This trade would end up being a net loss, but you still lose much less than you stand to gain in other scenarios.
• The Euro price could expire at 5.3 exactly, making your put option at-the-money. You would receive $500 in return of your initial investment. In this case your put option would be in-the-money, and you would receive $850 on your initial investment. Total investment= $1000. Profit= $350.  (-500 + 850 + -500 +  500) This trade would end up being a net gain.

In each scenario, you stand a chance of winning a greater profit by hedging, or placing two bets in opposite directions, than the all-or-nothing chances of one binary bet. In the instances in which you stand you lose money, you lose far less than the possibility you have to gain a greater profit than loss in other circumstances.