It seems that the market reversed in favor of the dollar
The US dollar strengthened due to the speech by Fed FOMC member Robert Kaplan. He said about the necessity to raise rates "at the next meeting", but because of the president's meeting with congressmen, this news didn’t attract attention.
Yesterday, US data disappointed
In the 2nd assessment, the GDP for the 4th quarter remained unchanged, 1.9% against the forecast expectations of 2.1%. The wholesale inventories showed a decrease of 0.1% compared to expectations of an increase of 0.5%. The Chicago manufacturing PMI rose from 50.3 to 57.4 from 50.3. The CB consumer confidence strengthened from 111.6 to 114.8. The Richmond manufacturing index increased from 12 to 17.
Another FOMC member John Williams endorsed the rate increase in March - the probability of a rate hike jumped to 67% according to the futures.
Speech by Donald Trump in Congress was not specific. Trump repeated already known changes in the health insurance and tax changes - without figures and details.
Today in the UK, the net lending to individuals is expected at 4.0 billion pounds in January against 4.8 billion in December. The number of mortgage approvals may show a slight increase – 68.6K against the 67.9K earlier. The British Manufacturing PMI is expected to decrease from 55.9 to 55.7 in February.
In the US the personal income is expected unchanged at 0.3%, personal spending can decrease from 0.5% to 0.3%. The Manufacturing PMI is expected to grow from 54.3 to 54.4. The national ISM Manufacturing PMI is expected without changes at 56.0.
How we trade binary
The aim of the pair GBP/USD is 1.24 and the level of 1.2431, where the bulls will activate. In the case of drop below 1.2352 in the first half of the day, we recommend buying Put options.
We would buy Put options if the pair GBP/USD goes below 1.2352. This scenario would be invalidated if the pair goes above1.2400 in which case we would go for Call options with the end of the expiry.
Target price: 1.2352
Expiry time: 21:00 GMT