Yesterday, as we suggested the pair GBP/USD strengthen after the publication of the results of the next poll on «Brexit».
The result showed the predominance of supporters to stay in the EU. However, the pair quickly lost its position after the publication of weaker than expected data on CPI and PPI.
Today the UK is to publish data on the average earnings index + Bonus, claimant count change, and unemployment rate. All these figures are expected to decline. After yesterday's data, we can presume that the forecasts will be in line with the actual data.
However, the publication of the minutes of the last meeting of the FOMC will be the main event today. The strong data on the US retail sales, housing market, inflation and industrial production slightly helped the dollar to strengthen. However, the April report can reflect the uncertainty of the Committee members in the stability of economic growth. If it’s so, the chances of the summer rate increasing will disappear.
How to trade
We expect the decline to the 1.43 area. We expect the continuation of the downward movement after overcoming the mark of 1.4400. We would buy put options if the pair falls below 1.4400.
Target price: 1.4400
Expiry time: 20:00 GMT