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GBP/USD Trading - Manufacturing PMI - 02 Aug 2016

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GBP/USD Trading - Manufacturing PMI - 02 Aug 2016
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Yesterday the US dollar weakened after the speech of the FOMC member William Dudley.

We also said yesterday that the FOMC has lost all the arguments for maintaining investor sentiment with respect to the September increase. Now it is clear that the FOMC is practically no interested in this issue.

British Manufacturing PMI fell from 49.1 to 48.2. The US ISM Manufacturing PMI also disappointed: 52.6 vs. 53.1 and 53.2 in June.

Today, we expect the decline in business activity in the UK construction sector. The forecast is 44.2 vs. 46.0. After yesterday's Manufacturing PMI it may be even worse. In the US, incomes/spending is projected to rise. Income - 0.3%, spending - 0.3%.

On Thursday, the meeting of the BoE will be held. Despite the opinion of investors that the Bank of England "should" lower the rate, there aren’t actual conditions for this reduction. We don’t see the characteristic of deterioration of macroeconomic indicators.

In theory, we assume the rate cut on Thursday. However, the Bank of England can keep the current rate, as the Reserve Bank of Australia has made today.

How to trade binary

We would buy call options if the pair GBP/USD rises above 1.3210. We would buy put options if the pair falls below 1.3170.

Expiry time: 20:00

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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