Categories: Fundamental Analysis

Cable Crashes As Sentiment Favored Sellers

The US dollar was seen trading higher against the British pound as it managed to gain buyers once again this week. The GBPUUSD pair climbed higher on Monday, but failed to capitalize on gains and moved lower again. There was an important resistance around the 1.5740 area, which proved vital one more time as the British pound struggled around the mentioned area and failed to break the same.

There were a couple of important economic releases lined up during the last couple of days, including the manufacturing PMI, construction PMI and consumer credit data. The outcome was mixed as one registered a better than expected reading and another one missed the forecast. The end result was the pair trading lower back below the 1.5700 area.

UK Manufacturing PMI
The first important release in the UK was the Manufacturing Purchasing Managers Index (PMI) released by both the Chartered Institute of Purchasing & Supply and the Markit Economics. The market was expecting the manufacturing PMI to decline from 53.2 to 53.0. However, the outcome was better than expected with a reading of 53.5. This was on the positive side, and the reaction in the GBPUSD was according to the outcome.

The GBPUSD was seen trading higher on Monday, as the pair managed to climb more than 80 pips. However, it was seen struggling around an important resistance around the 1.5700-40 area. The mentioned level acted as a monster hurdle for the pair in the near term.

UK Construction PMI
Yesterday, the UK Construction Purchasing Managers Index (PMI) released by both the Chartered Institute of Purchasing & Supply and the Markit Economics. The market was expecting the manufacturing PMI to decline from 61.4 to 61.0 However, the outcome missed the mark, and registered around 2 point decline with a reading of 59.4. This was not that good, but overall the reading was still on the higher side and well above the 50 mark.

The report mentioned that the UK construction companies indicated a strong expansion of business activity in November, but the overall pace of growth moderated for the second month running to its least marked since October 2013. The GBPUSD pair was seen trading lower and sellers managed to break the 1.5700 support area.

UK Services PMI
Today, the UK services PMI will be released. The forecast is slated for a rise from 56.2 to 56.6. If the outcome misses the forecast, then the British pound might come under pressure moving ahead.

Technically, the GBPUSD has a support around the 1.5600 area. However, the recent failure around the 1.5700-40 area suggests that the pair might continue trading lower. There is a chance of a double top pattern forming as well, which might encourage sellers in the near term.

So, keep an eye on all the important levels friends and trade accordingly.

Get my Daily Market forecast with trade opportunities HERE: Vladimir’s Markets Forecast

Advertisement

Click To Join Our Community Telegram Group

Vladimir Ribakov

Following 11+ years of trading experience, trading my own accounts as well as for hedge funds and brokerages, I have decided to fulfill my destiny and to personally mentor Forex and Commodities traders. When I released the “Broker Nightmare” (software that hides trades from brokers) 8 years ago, I found an overwhelming number of frustrated people who genuinely wanted to learn how to trade the Forex market, but instead found themselves scammed and misled. Over the years I have also release other trading systems based on my trading strategies, and met a lot of people on my worldwide Forex seminars. We’ve formed a close Forex community and we meet once or twice a year in various locations in Europe.

Recent Posts

Wall Street Inches Higher After Retail Sales Data

Wall Street's main indexes edged higher in choppy trading on Monday following the latest batch…

2 hours ago

Weekly Summary And Review 14th March 2025

Hi Traders! Arvinth here from the Home Trader Club team. The weekly summary and, review of March…

3 days ago

Wall St Trips On Trump’s Latest Tariff Threat; Inflation Data Offers Respite

The main U.S. stock indexes slipped on Thursday as President Donald Trump's escalated tariff rhetoric…

4 days ago

EURAUD Short Term Forecast And Technical Analysis

Hi Traders! EURAUD short term forecast and technical analysis post is here. We do our…

4 days ago

GBPNZD Short Term Forecast Update And Follow Up

Hi Traders! GBPNZD short term forecast update and follow up is here. On December 5th,…

5 days ago

EURJPY Technical Analysis And Short Term Forecast

Hi Traders! EURJPY technical analysis and short term forecast post is here. We do our…

5 days ago