Yesterday, the British pound strengthened on the back of a reduction in factory orders in the US
In the US, the volume of factory orders fell by 0.8% in May. The published minutes showed that members of the committee are ready to continue raising rates even if inflation is below the target level and agreed that the reduction in the Fed's balance sheet will have a limited impact on the markets.
Investors are convinced that they can safely continue to buy the US dollars
On Friday, we expect the greatest momentum when data on the US labor market will be published. Today, optimism may be supported by the indicators of ADP non-farm employment change for June, forecasted at 185K after 253K in May, and a reduction in the negative trade balance - the forecast for May -46.3 billion dollars against -47.6 billion in April.
The number of initial jobless claims is expected at 243K against 244K a week earlier, which will increase the positive effect of employment in the private sector. The Services PMI is expected to be unchanged, 53.0 points. The Non-Manufacturing PMI is expected with a slight decrease: 56.5 against 56.9 in May.
How we trade binary?
Till the pair GBP/USD is above 1.2925, we can count on the continuation of its growth. The formation of a false breakdown of 1.2925 will be an additional signal to activate purchases of Call options and to update the maximum of 1.2988. In the case of falling below 1.2925, it is better to postpone purchases.
Sellers will try to return the pair GBP/USD pair below the level of 1.2925. Fixing below 1.2925 opens a road to the area of 1.2868, where I recommend fixing the profit. If in the morning the pair grows, it is better to go back to buying Put options after upgrading 1.2988 or to rebound from 1.3019.
We are looking to purchase Call binary options with 20:00 GMT expiry if a one hour candle closes above the 1.2934 level. If our first target is not reached and the price breaks our support level at 1.2905, the first scenario would be invalidated. We would buy Put options if a one hour candle closes below the 1.2905 level.
Target prices: 1.2934 (Call) or 1.2905 (Put)
Expiry time: 20:00 GMT