UK Manufacturing PMI’s (Oct) rise to 53.2 , appears as an opportunity to short GBPUSD!

UK kbhars
UK kbhars

The Manufacturing Purchasing Managers’ Index (PMI) measures the activity level of purchasing managers in the manufacturing sector. A reading above 50 indicates expansion in the sector; below 50 indicates contraction. Traders watch these surveys closely as purchasing managers usually have early access to data about their company’s performance, which can be a leading indicator of overall economic performance.

Usual Effect: A high reading or a better than expected number is seen as positive for the GBP, while a low reading is negative.

Frequency: Released monthly, on the first business day after the month ends.

Last Read :51.6

Expectations : 51.2

Actual : 53.2

Volatility : Various from month to month !! (sometimes high volatility , sometimes medium volatility). 

Market Impact :A reading above 51.6 should bring bullish move.

Technical Outlook : Intraday outlook in GBPUSD remains on the downside as long as 1.6008 holds on a 4 hour basis , support comes at the 1.5965 levels ahead of the 1.5925 , further losses will aim the 1.5873 levels.On the upside , sustained trading above the 1.6008 levels on a 4 hour closing basis will extend rebound towards the 1.6087/1.6140 levels before the next fall.

Overbought zone : 1.6008

Support and resistance : 1.5800 , 1.5873 , 1.5925 , 1.5965 , 1.6008 (main), 1.6087 , 1.6140 , 1.6182

Conclusion : the pair is under pressure , trades below main resistance 1.6008 , further downside is likely …..but……….watch out for US ISM Manufacturing PMI (Oct) today at 15:00 GMT, positive US data should resume the bearish trend while negative US data could extend gains beyond 1.6008 levels ?!!!!