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GBP/USD testing highs near 1.5425, UK PMI eyed

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Nov 3, 2015.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
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    FXStreet (Mumbai) - The pound remains on the bids versus the US dollar heading towards early European trades, with GBP/USD now testing daily highs near hourly 10-SMA.

    UK construction PMI in focus

    The GBP/USD pair trades 0.06% higher at 1.5426, hovering in a 15-pips narrow range. The major traded around a flat-line almost through Asia and now extends the side-trend in Europe, finding good support at hourly 50-SMA located at 1.5412.

    The cable remains lifted mainly driven by the impressive manufacturing PMI report from the UK released on Monday. The UK manufacturing PMI, came in significantly better than expected at 55.5 points in October, up from a revised 51.8 points seen in September, hitting the highest level in sixteen months.

    Further, the US dollar erased US manufacturing PMI-led gains and now trades broadly lower, partly contributing to the mild gains seen in GBP/USD.

    Attention now turns towards the crucial UK construction PMI report due for release later in the session, with markets expecting construction sector activity in the UK to have slowed to 58.9 points in Oct versus 59.9 booked in Sept.

    GBP/USD Levels to consider

    The pair has an immediate resistance at 1.5444/50 (100-DMA/ psychological levels) above which gains could be extended to 1.5500 (round number). On the flip side, support is seen at 1.5412 (1h 50-SMA/ today’s low) below which it could extend losses to 1.5363/59 (200-DMA/1h 200-SMA).
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