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GBP/USD Trading - US Non-farm payrolls - 6 Jan 2017

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GBP/USD chart 6 Jan 2017
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Yesterday, the US dollar was unable to strengthen against the British pound.

The British Services PMI rose from 55.2 to 56.2 (the forecast was 54.7). The US data came out positive. In December the ISM Non-Manufacturing PMI remained at 57.2 against the expectations of the decline to 56.6.

Data on the US labor market were mixed.

Non-farm employment change from ADP was weak (153K against the expectations of 170K). However, the weekly report on jobless claims reported only about 235K claims against 263K the previous week. This indicator has a greater correlation with the key data on non-farm payrolls, which is published today with the forecast of 178K vs. 178K in November.

Today, we are waiting for the data on labor are not worse than expected. The US unemployment rate is expected to grow from 4.6% to 4.7%, but it is the permissible pullback after the consecutive decline in three months. The average hourly earnings are expected to increase by 0.3%. The negative point is expected from the data on factory orders for November. The forecast assumes a reduction by 2.2%. But there is a positive thing - the previous growth was 2.7% in October, which was the largest increase since October 2014. Thus, we expect a reversal of the pair GBP/USD and the further strengthening of the US dollar.

How to trade binary

Today, the sellers will try to overcome the support level of 1.2355, the breakdown of which will return the pair GBP/USD in the area of 1.2323. The buyers will try to go above 1.2413. Only fixing above this level will lead the pair GBP/USD to new highs at the 1.2430 area. We would buy Put options if the pair GBP/USD falls below 1.2355. This scenario would be invalidated if the pair goes above 1.2413, in which case we would go for Call option with the end of the expiry.

Asset: GBP/USD
Direction: Put
Target price: 1.2355
Expiry time: 21:00 GMT

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.

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