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GBP/USD trading signal - UK Services PMI - 04 Jul 2018

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Signal details
Entry Price: 
1.3200
Close Price: 
1.3226
Direction: 
High
Expiry Time: 
21:00 GMT
Result: 
ITM
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The UK's services PMI numbers for the month of June will be released today at 0930 GMT by Markit. According to the economists polled services activity as measured by the services PMI is expected to show a slight dip in the index to 53.9.

Previously, in the month of May, services activity was seen rising to 54.0. This came following nearly two consecutive months of declines after the index had previously surged to 54.5.

Services sector activity in the UK remains broadly weak. Today's services PMI will be an important factor for investors as it would potentially indicate how the UK's economy had fared in the second quarter of the year.

After the recent first quarter GDP signaled that the economy grew at a pace of just 0.2% both central bank policy makers and economists are hopeful that the UK's economy would rebound in the second quarter.

Investors will be interested to see how big a rebound this was. The services sector which plays a crucial role feeding into the nation's GDP will therefore remain a key indicator to watch out for today.

Activity in the services sector is expected to be subdued largely due to lower consumer spending and flattening wage growth. On the other hand, higher interest rates and higher inflation are also expected to put a lid on spending keeping the activity in the services sector broadly subdued.

Based on the above today's trading signal is GBPUSD. The currency pair was seen extending the gains yesterday and price action is consolidating near the resistance level 1.3220. We expect that the GBPUSD currency pair will eventually break off the resistance level to close higher on the day.

gbpusd signal 04 jul 2018

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.