4:30am (NY Time) UK Manufacturing PMI Forecast 54.1 Previous 54.1
ACTION: GBP/USD BUY 56.1 SELL 52.1
Our focus for today will be on the Manufacturing PMI number from UK and it’s forecasted at 52.0; UK PMI’s medium point is 50, therefore this forecast is considered as a positive release (above the 50 level means expansion in the manufacturing sector).
We are looking for a tradable deviation of 2.0, and because this is a leading indicator and its impact may affect the future trend of this currency for the remainder of the week or even for the month of February, market should react to this release with volatility should we get out deviation. We can expect GBP/USD to move 50 pips within the hour if you deviation is hit.
Due to the risk adverse sentiment in the market and the general strength of USD, I’d use extreme caution on the better than expected release as GBP is still expected to depreciate against the USD in the medium term… Take the context of the market into your trading consideration.
DEFINITION:
“UK Manufacturing PMI is a survey of purchasing managers in the manufacturing sector on various economic activities, including inventory, employment, orders, etc… A higher than 50 reading means expansion, or a less than 50 reading means contraction.”
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