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USD/JPY binary signal - Philly Fed manufacturing index - 20 April 2017

Signal details
Entry Price: 
108.80
Close Price: 
109.32
Direction: 
High
Expiry Time: 
20:00 GMT
Result: 
ITM
How we trade
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The economic calendar today is relatively quiet with no major releases scheduled. The focus will be on the U.S. Philly Fed manufacturing index which is a leading or a forward looking indicator that will be of some impact to the markets amid a quiet day of trading.

Therefore, the USDJPY currency pair is likely to come under pressure into the release. The data will be important for the traders as last month the ISM's manufacturing PMI posted a weaker pace of gains registering a headline print of 57.2 in March. This came after the ISM manufacturing PMI rose to 57.7 the month before. The minor pull back did not have much impact on the markets, but a prolonged decline could no doubt begin to rattle investors.

Today's Philly Fed manufacturing index will be for the month of April. Last month, the survey results showed that regional manufacturing activity continued to expand as the diffusion index for general activity fell to 32.8. This was the first monthly decline after the regional Fed manufacturing index rose to 43.3 in January.

Forecasts for today's data which is for the month of April, is expected to show another decline to 25.6. This will mark a second consecutive monthly decline from the peak posted in January this year.

Earlier in the week, the New York Federal Reserve posted its monthly manufacturing survey results which showed a decline in the index to 5.2, from 16.4 in March. This was even below the median estimates of 15.2. Thus, based on the above, if we get to see a weaker reading today, there is a strong chance that the upcoming ISM manufacturing index will be coming out weaker. The data is expected to be released sometime next week.

Based on the above factors, we recommend daily CALL options in USDJPY for today's binary options signals. Look for an intraday dip to 108.80 where we expect to see USDJPY dip ahead of a short term rally in prices.
Therefore, purchase daily CALL options in USDJPY at 108.80 for a 20:00 GMT expiry time as we expect some strength in the U.S. dollar.

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.