The Dow Jones Industrial Average is a favorite index among many binary options traders, and for good reason. It is the flagship index of the largest economy in the world, the United States. Recently, we’ve seen quite a bit of volatility in the Dow. However, over the past few trading sessions, the index has been climbing, largely as a result of the budget plan from President Trump. However, even as the plan is called into question, the Dow continues to head upward. Today, we’ll talk about Trump’s plan, why it’s having an effect on the Dow Jones Industrial Average, and what binary options traders should be watching for when trading the index ahead.
Trump’s Budget Key Points
Ultimately, President Trump’s budget includes quite a bit of what was expected by many. Here are the key points…
- Subsidy Cuts – First and foremost, President Trump wants to cut back on subsidies for the poor in a big way. In particular, he wants to cut Medicaid by $800 billion over 10 years and food stamps by $192 billion over 10 years. In doing so, the hope is that poor people will need to find work, rather than living off of the government, helping to fuel economic growth.
- Energy – President Trump would also like to sell nearly half of the United States’ strategic oil reserves. In doing so, billions of dollars would be raised that could help to cure the deficit.
- Financial Deregulation – Also, Donald Trump plans on curbing spending with regard to financial regulation. In particular, the Consumer Financial Protection Bureau and Securities and Exchange Commission would both face large cuts and would be forced to restructure.
- Agriculture Cuts – The new plan also includes various cuts to agriculture funding, that all together would add $46.5 billion to the United States’ balance sheet. $38 billion of which would come from farm support.
However, there’s a bit of a hiccup here. Many on both sides of the isle are saying that the budget plan was dead on arrival. Unfortunately, it seems as though Trump is going to have an overwhelmingly difficult time getting the plan passed.
What This Has To Do With The Dow Jones Industrial Average
At the end of the day, any government’s budget plays a key role in the country the government oversees having the ability to maintain economic growth. However, it goes far beyond that. Another big factor to the budget plan is massive tax cuts for consumers and businesses. Between a better balanced government and tax cuts, well businesses are likely to do even better.
Nonetheless, even as lawmakers raise questions about the plan, the Dow continues to fly. The reason is relatively simple. Ultimately, Donald Trump decided to go very far into the conservative side of things here. So, even if the budget is knocked down, chances could be made that would retain the budget’s business friendly appearance to get it through negotiations.
What Binary Options Traders Should Be Watching For Ahead
Moving forward, binary options traders should be keeping a close eye on the Dow Jones Industrial Average as the index is likely to present several profitable opportunities ahead. However, if you want to take advantage of these opportunities, you’ll need to stay on top of the news. In particular, pay close attention to what’s going on with the budget plan. Also, keep an eye on earnings reports and economic data out of the United States. Any updates on any of these stories will likely lead to opportunities worth taking advantage of.
What Do You Think?
Where do you think the Dow Jones Industrial Average is headed moving forward? Join the discussion in the comments below!