Yesterday the Cable showed an increase on the back of good inflation data but dropped by the end of trading.
In the UK, the CPI rose from 0.9% to 1.2% in November, against the forecast of 1.1%. The core CPI rose from 1.2% y/y to 1.4% y/y, while expected 1.3% y/y. The retail prices index increased from 2.0% y/y to 2.2% y/y. The house price index declined from 7.0% to 6.9%.
Today, the Fed meeting and press conference of Janet Yellen is the main event.
Nobody has doubts that the rate will be raised today. Moreover, there is a likelihood of increase from current 0.50% to 1.25%. But this event will be late in the evening, and during the day we get the interesting news.
The UK will present data on unemployment - the number of unemployment claims is expected to be 5.5K in November against 9.8K in October. The unemployment rate is expected unchanged 4.8%. The average earnings index is projected to be unchanged 2.3%.
The US will present retail sales data. The forecast is 0.3% in November which looks like a strong growth trend after the previous growth of 0.8%. The core retail sales are expected to increase by 0.4%. The industrial production is expected to decline by 0.2% with a decrease in capacity rate utilization to 75.1% from 75.3%.
How to trade binary
The level of 1.2679 limits the upward movement. The break of this level will lead to new tests of the highs around 1.2716. The sellers will try to drop below 1.2653. The breakdown of this level will allow the pair GBP/USD decline to the area of 1.2631 or lower. We would buy Call options if the pair GBP/USD rises above 1.2679. This scenario would be invalidated if the pair goes below 1.2653, in which case we go for Put option with the end of the expiry.
Target price: 1.2679
Expiry time: 21:00 GMT