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EUR/USD binary signal - Germany PPI - 20 Jun 2017

Signal details
Entry Price: 
1.1160
Close Price: 
1.1125
Direction: 
Low
Expiry Time: 
20:00 GMT
Result: 
ITM
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The producer prices index from Germany will be due for release today at 0600 GMT. According to the economists polled, inflation at the factory gate is expected to fall 0.1% in May. The expectations come after producer prices rose 0.4% on a month over month basis in April.

On a year over year basis, German producer prices rose 3.4% on the year. Most of the gains from the previous month was on account of a 4.6% increase in just energy prices alone. With energy prices falling, the producer price index is expected to take a hit as a result.

In May, consumer price also fell on account of weaker energy prices and as a result, the inflation at factory gate is also expected to fall. Weakness in the inflation is likely to come by validating the fact that inflationary pressures in the Eurozone are still to be entrenched.

What this could mean as far as monetary policy is concerned is that the ECB's stance on maintaining the current loose monetary policy will likely to continue unless there is real evidence of rising inflation at both consumer and factory gate level.

A weak PPI data today could signal some weakness in the euro. Therefore, our recommended binary options signal for today is EURUSD. EURUSD opened this week higher but on Monday, it closed with losses. The weakness is expected to continue in the EURUSD as various Fed officials are likely to come out hawkish on the Fed's monetary policy.

EURUSD closed below $1.1200 yesterday and this weakness is expected to continue with further losses likely to come by. Therefore, we look to purchase daily PUT options in EURUSD at 1.1160 for a 20:00 GMT expiry time.

Following a minor retracement, EURUSD is expected to continue to push lower, warranting PUT options as we expect to see the currency pair close lower on the day.

binary options signal EURUSD 20 Jun 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.