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EUR/USD binary signal - FOMC Meeting Minutes - 05 Jul 2017

Signal details
Entry Price: 
1.1400
Close Price: 
No trade
Direction: 
Low
Expiry Time: 
20:00 GMT
How we trade
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The United States Federal Reserve will be releasing the meeting minutes from the June monetary policy meeting today at 1800 GMT. The meeting minutes will show the internal deliberations among policy makers for the FOMC meeting that was held on June 14th.

The Federal Reserve had hiked interest rates by 25 basis points at that meeting. The vote for a rate hike was nearly unanimous with only Neel Kashkari voting against a rate hike. The market reaction to the rate hike was rather mixed. However, the Fed had made its intentions clear that it would continue ahead with policy normalization.

The FOMC meeting minutes will be closely watched by traders and investors for any clues on the next move from the Fed. The central bank is also likely to begin unwinding its balance sheet which stands at more than $4 trillion. This amount was amassed during the Fed's QE operations after the 2008 financial crisis.

The unwinding of the balance sheet is a form of policy tightening in itself. The FOMC meeting minutes today will be no doubt volatile for the markets, but more volatility remains ahead of the Friday's payrolls report.

The U.S. dollar is seen trading muted after posting strong gains on Monday. With the U.S. markets closed yesterday on account of the Independence Day holiday, the markets will be opening today with a lot of interest ahead of the FOMC minutes.

There is a strong chance that today's FOMC meeting will be hawkish and this could see the markets re-price the expectations for further tightening from the Fed as a result. Therefore, the past few weeks of declines in the U.S. dollar could very well be posting a recovery in the near term.

Based on the above, the binary options signal recommendation for today is EURUSD. The pair has been posting strong gains in the past few weeks but since early Friday, June 30, the currency pair has been trending lower. We expect this trend to continue.

Therefore we would purchase PUT options in EURUSD at 1.1400 for a 20:00 GMT expiry time, on the pullback ahead of further declines that could come. Following the pullback to 1.1400, EURUSD could be seen closing lower on the day.

binary options signal eurusd 05 Jul 2017

Disclaimer: The article is written for informative purposes only and it is not financial advice. The author does not have any position in the currency pairs mentioned, and no plans to initiate a position. He wrote the article himself and expressed his own opinions. He has no business nor personal relationships with any mentioned government entities or stocks. Readers should not treat any opinion expressed by the author as a specific inducement to make a particular trade or follow a particular strategy, but only as an expression of his opinion.