Manufacturing PMI is a leading indicator and it’s usually released during early month. Traders pay attention to this release for surprises as this survey may help to shape the general trend of the market. Here is the forecast:
4:30am (NY Time) UK Manufacturing PMI Forecast 57.6 Previous 58.0
ACTION: GBP/USD BUY 59.6 SELL 55.0
The Manufacturing PMI is forecasted at 57.6. Since PMI’s medium point is at 50, 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 (or the difference between the forecast figure and the actual release figure) of 2.0, and because this is a leading indicator and its impact may hint the future trend of other indicators (such as inventory, employment, retail sales, etc..) , market should react to this release with volatility if we get our deviation. We can expect GBP/USD to move 50 pips within the hour if it is hit. On a side note, with JPY strengthening on the back of risk aversion sentiment and the slew of negative economic data released globally, GBP/JPY may provide a better alternative for a SELL trade if we get our SELL trigger.
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.”
Related posts:
- Forex Trading Plan For UK Manufacturing PMI 10/01/10
- Forex News Trading UK Manufacturing PMI 01/04/2011
- Strategy For UK Manufacturing PMI 06/01/10
- Forex News Trading UK Manufacturing PMI 12/01/10
- Forex News Trading UK Manufacturing PMI 05/03/11
- Forex News Trading UK Manufacturing PMI 03/01/11
- Forex News Strategy UK Manufacturing PMI – 11/01/10
- Forex News Trading UK Manufacturing PMI 02/01/11
- UK Manufacturing PMI 11/02/09
- Forex News Trade UK Manufacturing PMI 6/1/11
